21 years ago I assembled the shareholders and signed the papers which created Warburg Realty. Then, as now, we were emerging from a severe recession. I still believe in the future to which I pledged myself and the company in September of 1991. As a token of that belief, Warburg has just signed leases to expand and move our headquarters to a full floor at 654 Madison Avenue, on 60th Street. How the future shapes up will depend on many factors outside any of our control, but New York possesses a number of essential attributes which protect our real estate sales market against the worst sorts of adversity. Here they are:
* The city never stops growing. For a variety of reasons, from economic opportunity to energy efficiency, from artistic freedom to racial heterogeneity, America’s great cities are magnets whose attraction just grows greater from one year to the next. And what city is greater than New York? People from all over the country and the world flock here to live every year, eager to make our city’s energy and excitement work for them.
* There is little housing available. Every year, our housing shortage becomes more acute. The rental market is tighter than it has ever been, converting many would-be renters to would-be buyers. And according to the most recent census, rentals account for 70% of Manhattan’s housing stock! No wonder so many would-be buyers feel there is nothing for them to look at. With only 30% of Manhattan’s housing stock in the sales pool to begin with, there is never more than 1.5% or 2% available at any one time.
* The city is an incubator for business growth. An August 19th Crain’s article points out the discrepancy between the stubbornly high unemployment numbers about which we keep reading and the actual rate of job growth in the city, which has seen 200,000 new jobs added since the recession ended in September of 2009. Gradually, such job creation leads to business expansion, which in turn leads to increased commercial leasing, residential rentals, and residential sales. If more people are employed, those people need to actually live and work somewhere.
* Quality of life throughout New York continues to improve. Crime remains at historic lows relative to other U.S. cities, and New York has never looked more beautiful. We have green space extending up the Hudson Riverbank from the Battery to 125th St, we have the High Line, and our parks are oases of tranquility, magnets for New Yorkers of every income and age level. We have spectacular new residential buildings designed by the world’s greatest architects. Broadway, Lincoln Center, BAM, countless galleries, and hundreds of small cutting edge venues in every borough provide display and performance opportunities for artists of every variety. There is no more exciting place to live.
For 21 years we have built a business based on integrity, product knowledge, negotiating expertise, and a deep belief in the city we inhabit and serve. These qualities have made Warburg a force in the marketplace as we come of age. Who knows what our marketplace will look like 21 years from now? My colleagues, my shareholders and I look forward to finding out.