More details on the curious valuation of future AY development sites for potential immigrant investors
As I wrote in December, the $542.4 million valuation for the seven development sites, which averages about $179 per buildable square foot, seems overvalued, at least when compared to what Forest City Ratner paid the Metropolitan Transportation Authority for similar (and partly overlapping) development rights over the Vanderbilt Yard.
It may be that Forest City Ratner got a good deal, and that the estimates presented to the potential immigrant investors, given the cost of actually turning that value into cash, were overblown. I queried the real estate firm Massey Knakal, which produced the official estimate of value, but got no response.
Why the variation in value?
The chart above right shows that Massey Knakal valued different development sites from $132/sf to $217/sf.
While the valuations generally increase over time, with higher valuations in later years, that's not a consistent explanation for the valuation.
(Anyone who reads Korean is welcome to enlighten me.)