Legislation to end double taxation between Taiwan and the United States is intended to spur semiconductor investment but is likely to rankle U.S. relations with China.

After cratering in the first quarter, Brooklyn investment sales rebounded in the second quarter, though there’s still a long way to go to compete with 2022’s banner year.

The dollar volume of investment sales in the borough rose 35 percent from the first quarter to the second, according to TerraCRG data reported by the Commercial Observer. There was approximately $1.5 billion traded in 281 transactions in the second quarter.

The improvement from the first quarter is significant, but the downward spiral from the first half of last year may be more notable. During the first six months of 2022, dollar volume of investment sales in the borough approached $5.3 billion. This year, the dollar volume wasn’t even half that, hitting only $2.6 billion during the same period.

Inflation and elevated interest rates are the biggest drags on investment sale activity in the borough. Owners are also wary to sell because of how increased capitalization rates may impact valuations.

The multifamily market saw a 35 percent drop in transactions between the first half of this year versus last year, and a 49 percent decrease in dollar volume traded. Regulation on rental buildings — such as affordable housing requirements — and the expiration of 421a contributed to the decline.

But when looking at the same time periods, investment sales declined across most property types, both in terms of dollar volume and total transactions. There were exceptions, though. Retail dollar volume made a slight gain, while the industrial market saw more total transactions. Development deals, meanwhile, increased in both metrics.

The first half’s largest investment sale this year took place in Brooklyn Heights in the first quarter, when a Rockrose Development affiliate purchased St. Francis College’s campus for $160 million; that deal has since become mired in a lawsuit.

The second quarter’s largest investment sale was affordable housing developer Tredway’s $150 million purchase of the Sea Park Apartments from Arker Companies in Coney Island. Private equity giant Carlyle’s $100 million purchase of a two-tower 421a site in Gowanus brought the number of nine-digit investment deals in the year’s first half to three.

TerraCRG chief executive Ofer Cohen told the Observer that the market’s potential for growth in the coming months is surging as discount purchasing opportunities emerge and the Federal Deposit Insurance Corporation prepares to unload roughly $60 billion in Signature Bank loans.

— Holden Walter-Warner

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The HBO host said he sympathized with the writers but needed to return for the good of other people who work on “Real Time With Bill Maher.”

University of Miami student Amanda Mohamad has been living in a hotel for a month. That wasn’t supposed to happen. 

Mohamad, a sophomore journalism major, has been waiting for her one-bedroom apartment at the Cloisters to finish construction. She, along with hundreds of other student residents, had planned to move in Aug. 18 — until the project’s developer Landmark Properties sent a last-minute message about construction delays at the 115-unit complex. 

Now, parents of Cloisters tenants say they are afraid to walk away from leases should the behemoth developer take legal action against them.

The two-part complex at 5830 and 5840 Southwest 57th Avenue in Coral Gables includes new construction townhouses and renovated apartment units, totaling 296 bedrooms for students. Amenities include a pool and fitness center, the complex’s website shows.  

Since alerting tenants and their parents of construction delays, the Atlanta-based developer has been paying to house students at the Biltmore and Thesis, luxury hotels near the Coral Gables campus. 

Frustrated parents of Cloisters residents have turned to social media to exchange information with one another. They made a Facebook group –– The UM Cloister Cluster –– where parents share photos of the site and intermittent communications from Landmark. 

“We have all been scammed,” Michele Paliseno, a parent, posted.

Units not as advertised

Landmark was able to receive county approvals for the townhouses on Sept. 1, and move residents into the townhomes that weekend. Upon arrival, parents said they found units were not as promised, with some missing laundry machines and furniture, and fire alarms going off. The pool, grounds and other common spaces remain under construction and far from completion, photos show. 

In a statement, Atlanta-based Landmark said, “Move-in day can often be chaotic, but our maintenance team and the general contractor have worked closely with residents to quickly remedy any issues that were not satisfactory on move-in day for townhome residents. These issues have been resolved.”

The developer also apologized for delays in communication with residents. 

Apartment tenants, like Mohamad, have been stuck living at the Thesis, in the meantime. Lucky for her, she said she eventually got off the waitlist for a mini fridge and a microwave. 

While apartment residents remain holed up in the hotel, photos of the units are leaving parents concerned they are not receiving the “fully renovated” units they were promised. The Cloisters website was quietly changed to remove that language. In a statement, Landmark said “Most fixtures, appliances, finishes, flooring and furniture were upgraded to new across renovated units.”

A thorny contract

Meanwhile, some parents want out of the leases they signed, saying Landmark has failed to deliver on its promise. But the fine print is not that simple.

“Basically we all hung ourselves with their lease,” said Jeff Buttrick, the parent of a would-be Cloisters resident. He is referring to the 56-page document signed by tenants and their guarantors. 

The contract allows for Landmark to house students in “alternative accommodations” while it works to deliver the units. Alternative accommodations include hotel rooms, according to the agreement, despite the dramatic difference in livability between a hotel room and a full apartment.

The language in the lease shows that tenants have the right to break the contract after 30 days if the unit has not been delivered. However, if Landmark provides alternative accommodations, such as hotel rooms, that right is voided. 

Parents say Landmark is rushing to get approvals and move students in this Friday because Saturday is Day 30, when tenants gain more solid footing to end the contract. Local attorney Jacqueline Salcines confirmed she is representing a number of Cloisters parents.

Buttrick didn’t wait for Day 30 to make his decision. He moved his daughter, Jenna, into a different apartment, and refused to pay Landmark her August and September rent.   

“We have not collected a penny of their food reimbursements. She did not stay in the hotel. We have not done anything to collect a penny from them,” he said. Getting out of the lease has been tricky, though. According to Buttrick, Landmark has insisted that his daughter find someone to take over her lease.

That has proven difficult. They found three potential tenants for Landmark, but each backed out after seeing the site in person. 

“It feels a bit scary,” one previously interested renter who Buttrick declined to identify texted on Wednesday, noting the ongoing construction. “My parents aren’t feeling confident in signing.”

Buttrick thought he knew what he was getting into when he signed his daughter’s lease with the Cloisters earlier this year. She had lived in another Landmark student housing complex last year, the Standard, and had a great experience. 

“The other one was beautiful,” he said. “It was clean.”

Buttrick’s experience with Landmark at the Cloisters is hardly unheard of, though. 

Delay, hotel, stipend, repeat 

Landmark, led by CEO Wes Rogers, is one of the largest student housing developers in the country, with $11 billion in assets under management. It has student housing complexes across the country, including in Knoxville, near the University of Tennessee. Landmark completed the 234-unit, eight-story Standard at Knoxville in January 2017, a full semester late, Knox News reported. Landmark followed its playbook in Knoxville, putting students up in hotels and providing them with a food stipend on Visa gift cards, according to the publication. 

That same fall semester, construction delays at the Standard at Boone in North Carolina dragged on, according to the High Country Press. Students were put up in hotels and handed Visa gift cards, and moved into the building in late December, the outlet said. 

In 2019, the Tallahassee Democrat reported construction and move-in delays at the Standard at Tallahassee. And In 2021, students moving into the Standard at Austin in Texas found rats, trash, dirty water and shorted electrical outlets in the newly finished building, according to KVUE. 

While parents of students at the Cloisters wait to hear if the complex receives its temporary certificate of occupancy, concerns remain about moving in when the site has ongoing outdoor construction and none of the promised amenities. In a statement, Landmark declined to offer any rent concessions, pointing to the hotel accommodations it provided, as well as per diem provisions for food, laundry and storage. 

Buttrick just wants out. “I’m not looking to sue them. I just want to be done with them,” he said. “The least they could do is let the kids out of the lease.”

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When Gary Barnett listed his Central Park Tower penthouse for $250 million, he raised eyebrows over whether he’d lock down a buyer at such an ambitious, or perhaps audacious, price.

But a year later, the high bar the Extell Development boss set has been lowered by $55 million. 

The developer slashed the price of the 17,500-square-foot triplex on Wednesday to $195 million, or $11,100 per square foot — more than a 20 percent decrease from the original listing price, according to Streeteasy and first reported by Crain’s New York. 

Ryan Serhant, head of his eponymous brokerage, has the listing. 

Since it hit the market, the former “Million Dollar Listing” star has splashed the penthouse across his social media channels. In a video posted to his Instagram account in January, Serhant labeled the penthouse the “highest residence” with the “highest terrace” in the world. The unit also made it to the front page of The Wall Street Journal. 

Serhant and Barnett may seem like an unlikely duo, but they have been working together for years. One of Serhant’s first deals was a two-bedroom unit at Extell’s 80 Riverside Boulevard, dubbed Rushmore. And they have teamed up on a few sponsor units at Barnett’s One57.

Representatives for Extell and Serhant did not immediately respond for comment.

Few residential deals have closed for more than $200 million, even on Billionaire’s Row. Among the few is hedge-funder Ken Griffin’s purchase of a 23,000-square-foot quadplex at Vornado’s 220 Central Park South, which broke the record for the priciest home sale in the U.S. at $238 million. 

In the five-year period before the penthouse’s listing, only 10 homes across the country had closed for more than $150 million, and most of those sold considerably under their asking prices, according to data from Marketproof. 

At the time, industry leaders cast doubt on Extell’s lofty price tag. Appraiser Jonathan Miller called homes at this price point a “circus sideshow,” while Marketproof’s Kael Goodman said it was “pure aspiration.”

But the low odds didn’t deter Barnett, who has notched nine-figure deals of his own. Billionaire businessman Michael Dell paid $100.5 million for a condo at Extell’s One57 in 2015.

When the penthouse hit the market, Barnett considered a quarter of a million dollars a fitting sum for the sprawling seven-bedroom overlooking the park.

“There’s a bunch of artwork going for $100 million and even $200 million,” Barnett told the Wall Street Journal. “When you compare that to 17,000 feet of steel and brick and glass at the top of the world, this seems like a relative bargain.”

Since closings started in 2021, discounts have plagued the supertall, marketed as the world’s tallest residential building. Barnett initially projected a $4 billion sellout for the building, but he acknowledged last year that it would likely be closing to $3 billion. 

The developer also dropped the price of another penthouse at the supertall yesterday. The 12,600-square-foot duplex is now asking $149.5 million, down from the  $175 million when it hit the market in March. 

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The final ranking will be formally revealed at the 100 Fastest-Growing Private Companies event on Oct. 26. For now, here’s a sneak peek.

The Business Journal received more than 200 nominations, and honorees were selected by our leadership team and contributors.

Shares of Arm rose in their highly anticipated stock-market debut Thursday, in a sign of the reviving fortunes of an IPO market that HAs been in the doldrums for most of the past two years.

Experts say the exploitation of a loophole in the patent system has contributed to high prices for inhalers.

Honoree A-P Hurd says when considering what type of board to serve on, think about other volunteer and work activities you love.