(Photo courtesy of nARCHITECTS)
Carmel Place, New York City’s first all-micro-unit building, will open in March at 335 East 27th Street. The development started as a pilot program in 2013 under the Bloomberg administration, essentially a call to architects to solve the unmet demand for studio space in Manhattan.
Even in New York City, where distinguishing a bedroom from a closet can be a challenge, the idea of a studio apartment as small as 265 square feet is jarring. But, news from the city that 60,000 people have applied for Carmel Place’s 14 below-market-rate units has silenced the skeptics. The 32 apartments that will hit the market will rent for $2,650 and $3,150, no chump change.
The enthusiastic response from renters begs the question: does the appeal of studios, regardless of size, transcend renters and encroach into the condo buyers’ market? Donna Olshan, president of Olshan Realty, believes it’s not crazy to think that micro units could become a factor in the first-time buyers’ market. New York’s younger professionals could opt to buy alone rather than hold out for a larger place with a spouse. “It’s also a good alternative for affluent parents looking for a place to buy for their college-aged student in lieu of a dorm room. It can also serve as a pied-a-terre as an alternative to a hotel room. The trick is to deliver a nice, small room with very good amenities, ensuring there is both a place to work and hang out. Done right, this thing will sell,” says Olshan.
With demand for solo residences high and buyers increasingly willing to compromise on space in exchange for privacy, it seems possible that smaller spaces could both maximize the number of units and profits for condo developers. “Land prices have tripled in many neighborhoods, squeezing profit margins and cost overrun margins for developers, while Mayor de Blasio has been much more circumspect about providing zoning variances for extra square footage,” explains Snezan Cebic, a broker with Douglas Elliman Real Estate.