Ander's Market Theories

[AnderL]

Foreign Skyscraper Purchases
in Real Estate
http://bigpicture.typepad.com/

Seems as if there is going to be some major currency shifts coming in the near future if history is repeating itself. Japan never lost anything when they bought and sold Rockefeller Center. They exchanges Yen for Dollars to make that purchase in the 1980s and then trades Dollar back into Yen when they sold it. Yes the price in Dollars on Rockefeller Center dropped over that length of time but when you factor in currency exchange and the value of the Yen in the 1980s and then in the late 90s you will see that they made money hand over fist. It's not as simple as trading currency and that is the end of it. The Japanses did gain on the leasing of the offices at Rockefeller Center over those years.

Seems the Emirates is going to do the same. In fact the US might be the target of a major international land grab as US investors sell off all their properties because the real estate market is crashing relative to their green tinted view.

Does this sound at all familiar to anyone else?

A foreign investor, flush with cash thanks to recent economic shifts, begins buying up landmark "trophy" properties in Manhattan.

If you are old enough, that may remind you of the Japanese in the 1980s, who amongst other items, purchased Rockefeller Center.

Well, its time to update your calendar. This morning, the NYT reported that "the royal family of Dubai, the oil-rich Arab emirate on the Persian Gulf . . . plunked down more than $1.1 billion for [2] buildings: 230 Park Avenue, the gold-crowned, 34-story tower that sits astride the avenue between 45th and 46th Streets, and the Essex House, one of the grand Art Deco hotels on Central Park South."

These most recent acquisitions comes on top a 3 year billion dollar spree in U.S. real estate, including "nursing homes, office buildings, hotels and thousands of apartments in Dallas, Phoenix, Nashville and Atlanta."

The Times wonders aloud if "the emirate can . . . escape the fate that befell Japan15 years ago when it made too heavy a bet on real estate at the top of the market and lost. . . . "

You can see the 2 properties below:

Essex House




Helmseley Building




Sources:
Art Deco Era Architecture in NYC
http://www.greatgridlock.net/NYC/nyc2.html

Alphabetical List of New York Buildings
http://www.wirednewyork.com/alphabetical.htm#E

Helmsley Building
http://www.thecityreview.com/helmsley.html

Arab Royals Buy 2 Pieces of the Skyline
CHARLES V. BAGLI
NYT, November 10, 2005
http://www.nytimes.com/2005/11/10/nyregion/10build.html