The real estate market may be in somewhat of a holding pattern while the global economy rides out the coronavirus pandemic, but there is seemingly no market uncertainty for Amazon CEO Jeff Bezos.
Want proof? The world’s richest man just paid $16 million for his fourth apartment in one building at 212 Fifth Ave. in New York City—the current coronavirus capital.
The building—on 26th Street in a neighborhood known as NoMad (north of Madison Square Park)—includes a state-of-the-art fitness center with adjoining golf simulator, a game room, cold storage area for grocery deliveries, and pretty much everything else a billionaire could want, which could explain why he’s widening his already large footprint in the building.
In June 2019, Bezos dropped $80 million on the building’s three-story penthouse, known as “The Crown,” and two apartments on the floor directly beneath it.
So what does Bezos plan to do with all of these apartments? Building permits filed on Bezos’ behalf in the fall of 2019 show he wanted to combine the first three units into one palatial pad in the sky.
As for the fourth unit? Perhaps it’s a posh guesthouse for his friends.
“He is doubling down in the same building that he bought in last year because he wants to expand his home,” says Sheila Trichter of New York’s Warburg Realty. “Buying adjacent units or units above and below is a common occurrence if you can afford to do it.”
What Jeff Bezos’ latest purchase means for New York City
So what does Bezos’ NYC home shopping spree mean for the city? Real estate professionals agree it shows a significant vote of confidence for the Big Apple’s real estate market, even during tough times.
“Jeff Bezos still obviously sees a lot of value in New York,” says Marie Bromberg, a real estate agent with New York’s Compass. “He understands that the coronavirus is temporary. While a recovery won’t happen overnight, when we do come back, I have every confidence that we will come back strong. His buying pattern is a validation of that belief.”
Ryan Serhant of Nest Seekers and Bravo’s “Million Dollar Listing New York” explains why buying in Manhattan always makes sense, no matter what challenges roil the city.
“Owning prime real estate in New York is like owning gold,” says Serhant. “When equity markets are volatile, buyers crave something they can touch, like real estate.”
“Jeff Bezos can buy any apartment he wants in any part of the world,” points out Trichter. “Yet he chooses to buy in New York City. … New York is forever, hopefully the coronavirus will eventually leave town.”
‘Bezos didn’t get a bargain’
But with New York City real estate on near lockdown, did Bezos snag a discount on his new three-bedroom on the 20th floor? At $16 million, real estate agents say no.
“Bezos didn’t get a bargain,” says broker Svetlana Choi, also of Warburg Realty. “He is still paying what any normal person would call ‘nosebleed’ prices for his properties.”
In fact, Warburg Realty’s agent Christopher Totaro thinks Bezos paid above market value for all of his acquisitions at the iconic 212 Fifth Ave. address. Bezos handed over about $58 million for the penthouse—which has five bedrooms and six bathrooms in 10,079 square feet of interior space, and 5,730 square feet of terraces—and around $22 million for the other units.
“So I don’t see this as a bargain shopping spree,” says Totaro, who adds that despite a softening in the luxury market since the coronavirus shut down New York, prices haven’t dropped all that much.
In fact, according to Totaro’s research on the total 4,811 condos and co-ops listed in Manhattan from March 20 through April 17 (excluding new developments), the data shows only 101 price reductions. And the bulk of those price reductions were in the 2% to 7% range. That’s not much of a discount.
“I don’t believe that there are huge bargains today unless someone really needs to sell,” says Totaro. “I think that much of the market is in a wait-and-see mode.”
Where else is Bezos buying?
Bezos’ new property purchase is only the latest in his growing real estate holdings that span the nation. Over the past few months, Bezos has made several multimillion-dollar property purchases.
In January, Bezos bought a 4,785-square-foot home featuring four levels, a 700-bottle wine cellar, and private roof deck in Washington, DC, that was listed for $4,995,000 and is across the street from a home he had bought in 2017 for $23 million.
Then in February, he bought a Beverly Hills, CA, mansion from music mogul David Geffen for $165 million. (It was the most expensive home ever sold in the Los Angeles area.)