Though D.C. Is Kinda King, Too
A frequent theme at today’s Bloomberg Real Estate Briefing was just how great New York City real estate is. But there is one other place that all the machers look fondly on–perhaps making them the only people in the country who do so: Washington, D.C.
Even the politicians don’t like it, at least not the Tea Partiers, and while that has Henry Elghanayan worried about what D.C. might do to New York, most of his colleagues argued today that Washington is a great place to invest, now and for the foreseeable future.
Fried Frank’s Jonathan Mechanic: “I don’t think people are afraid of the Washington market just because of the change in Congress. We still have big government and a split government, and there’s a lot of problems to be worked out still, so there will be plenty going on.”
John Catsimatidis: “Washington will not stop growing, no matter who’s in control. It’s a disease they have there. If there will be cuts, it will be in different parts of the country.”
David Levinson, who said his L&L Holdings just got outbid for a project on Connecticut Avenue: “The government has a tendency, they fire 500 people and then go hire 500 consultants, so there is always high demand. … The average price is in the mid-40s gross, but it’s 58 net on new buildings, almost double the rent on new buildings there.”
Richard LeFrak: “The thing I worry about the most are that the GSEs [Government-sponsored enterprises] are natural targets, both for the Republicans and the Democrats. Freddie Mac? Who is it? Most people just know it as something bad that happened to their mortgage. That makes for an easy target. … That could change the rezzies [residential developers] quite a bit. We’re benefiting from rates that are very low.”