Midtown East is not Just for Happy Hour

Midtown East does not usually make an apartment hunter’s shortlist.


But with prices there lower than in many other Manhattan neighborhoods, buyers and developers are taking a fresh look at the area, roughly defined as from Fifth Avenue to the East River between 40th and 59th Streets, particularly its eastern swath. Until recently, the neighborhood’s biggest draw was its enviable commute to the office. Now, that perception is changing.


In recent months, developers have broken ground on several luxury projects, including 50 United Nations Plaza, a 43-story luxury tower rising across from the United Nations Secretariat Building where condominium prices will begin just north of $2 million. As high-rises reshape the skyline, new upscale restaurants are adding a sophisticated flavor to the Second Avenue corridor, which has long been dismissed as a forgettable happy-hour magnet for young office workers.


“People associate Midtown East with work, they don’t think of it as residential,” said Victoria Vinokur, a broker with Halstead Property. “We don’t have the boutiques, we don’t have the SoHo atmosphere. But I think this is such a terrific, true Old World neighborhood. It’s very discreet. It’s very charming.”


Celebrities are taking notice. Last year, the actress Uma Thurman bought an apartment in the exclusive River House on East 52nd Street. And this spring Mary-Kate Olsen and her fiancé, Olivier Sarkozy, bought a townhouse in Turtle Bay Gardens, an enclave of rowhouses along 48th and 49th Streets, between Second and Third Avenues. The actress Katharine Hepburn lived in one of the houses on 49th Street for decades.


Residential construction has been frenzied recently. A 61-story tower designed by Foster and Partners, the firm headed by the Pritzker Prize-winning architect Norman Foster, is rising at 610 Lexington Avenue next to the Seagram Building. Construction is underway at the Sutton, a 30-story tower at 959 First Avenue. And last month, sales began at the CookFox-designed 301 East 50th Street, a 29-story building with a limestone facade.


Added to that, the commercial area around Grand Central Terminal also might change dramatically in coming years once Mayor Bill de Blasio revives a proposal to rezone about 70 blocks of Midtown East. The original plan, which fizzled in the waning days of the Bloomberg administration, would have paved the way for a new generation of taller, state-of-the-art office buildings. As a first step in a long-term rezoning effort, the de Blasio administration plans to rezone Vanderbilt Avenue to allow for a 1,200-foot-tall skyscraper and a pedestrian plaza, along with infrastructure improvements.


“It’s a lot happening all at once, and the people in the immediate vicinity are certainly struggling with the effects” of simultaneous construction projects, said Daniel R. Garodnick, a member of the City Council whose district includes Midtown East. Mr. Garodnick is part of a task force that will provide the mayor with recommendations on how to rezone the commercial area.


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Despite the influx of luxury high-rises, Midtown East still sells at a discount compared with trendier Manhattan neighborhoods. In 2013, the average price for a condo in Midtown East, from Fifth Avenue to the East River, was $1.85 million compared with $3.22 million in the West Village. Closer to the river, prices drop further, to $1.48 million for a condo in Turtle Bay, according to data provided by CityRealty.


“Manhattan is inward-looking,” said Jonathan J. Miller, the president of the appraisal firm Miller Samuel. “Unless you’re directly on the water, values often tend to slide downward as you move away from the center.”

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