Content area
Full Text
JOHN MOODY IS WHAT the real estate industry would call a motivated buyer. He has someone else's cash, and he is anxious to spend it. His problem: He can't find anything he wants to buy among the buildings up for sale.
As president and chief executive of Cornerstone Properties Inc., a German real estate investment fund, Mr. Moody has had no trouble buying attractive properties in Boston. and on the West Coast. But in his perusal of midtown Manhattan, he has come up dry.
"We're very selective," says Mr. Moody. "We have a tight envelope where we're looking to buy. We want a prime midtown location and a modern building. We want something of A quality that's a little off the trophy class. We don't want a retrofit, and there's a lot of stock that's not suitable."
Mr. Moody isn't alone, in either his quest or his disappointment. Sensing the potential for a firming in the New York commercial market, foreign investors from Europe, South Asia and South America--as well as pension funds and insurance companies--are lining up to do deals on Manhattan buildings. But much to the chagrin of buyers and sellers, there are no properties that meet their requirements.
Lots of money, little quality
"There's a lot of capital looking for office product, but nothing on the market shows much quality," says David Robinov of Eastdil Realty Inc. "What you don't have, and what these buyers want, are well-leased buildings from institutional ownership. Instead, you have these older buildings with low occupancy."
One reason that top-flight properties...