The news recently that the 1,400-foot pencil tower at 432 Park Avenue is facing severe structural issues because the architect used the wrong kind of concrete causes one to question yet again the joys of big city living. Apartments in that building go for $30 million or so, for which you could buy a very nice Georgian country house in one of England’s more fashionable counties or a late-Victorian gothic palace in New York’s Hudson Valley. With the Islamic Marxist Zohran Mamdani about to become Mayor of New York and expropriate you, why the hell would you stay there?
I entirely understand the appeal of New York to young middle-income careerists. Armed with degrees from fashionable colleges and a collection of “woke” social attitudes they hope by working 100-hour weeks in a New York bank or law firm to become high-income careerists. They put up with New York’s high taxes, high costs, high crime and general unpleasantness in order to reach their cherished goal. If they reach it, they will move into a larger apartment in the city, since costs are no longer a problem. If they do not reach it, or if they reach it but want a civilized family life, they will move out to the suburbs when they near 40, abandoning their Democratic Socialists of America membership and moving awkwardly toward the Republicans (but possibly not reaching that Nirvana).
For the middle-income, the ultra-rich or even the poor, I thoroughly recommend New York’s Hudson Valley suburbs. As well as the truly beautiful (if sometimes architecturally bizarre) late 19th century Robber Baron palaces that might appeal to the truly rich, there are homes to suit all pockets, with the price declining rapidly once you get beyond New York and its inner suburbs. Here in Poughkeepsie, prices are one tenth of Manhattan’s at most, with only a modest premium to what you would pay in the wilds of North Dakota (and there are many more nice old houses here than in North Dakota, which was barely settled before 1900.) Add to that an excellent restaurant scene with the Culinary Institute of America and innumerable bistros started by its graduates (I realized we had ”come home” when the UPS man asked “You from the CIA?” and I realized he did NOT mean the outfit in Langley, VA.), Thus, New York has few remaining lifestyle advantages – and is easily reachable by train in a couple of hours for those with withdrawal symptoms. Finally, the politics are reasonable – more on that below.
In my last rant against the evils of big cities I suggested that Queen Boadicea of the Iceni’s approach to the new Roman city of Londinium, burning it to the ground, had much to commend it.
I also prognosticated optimistically that modern video communications, Zoom and the like, might soon make big cities obsolete, as employees would be able to communicate with colleagues without entering the office, and even their social needs could be catered for by Tinder and its more or less gamy competitors. That seems not to be happening, for two reasons. First, companies have (probably rightly) grown deeply suspicious of the Covid-inspired trend for “working from home” believing that in the case of less than perfectly motivated employees, it is simply a license to goof off.
Second, current video interaction technology, while fine for corporate meetings, has flaws when used for human conversation. Because of the need to go through a complex switching process, there is a “latency” of perhaps 20 milliseconds between a sound being emitted and it being received at the other end. This produces a “distance” between the participants that prevents them from achieving more than superficial communication. Further, if there are more than a few participants in the “chat” it is both difficult to break through the group and make points, and impossible to have a side conversation with one of the other participants. In this respect a video chat is like a formal office meeting rather than a dinner party, and it is difficult to make new connections through it.
However, these strictures tying wage-slaves to the metropolis do not apply to those with net worths of $150-200 million or more, the market for pencil tower property ownership. They generally do not have offices to go to and if they do their physical presence there is truly optional. They do not have to commute on public transport if their residence is far from the city, they can get a limousine or a chauffeur-driven automobile. The costs of the city are no problem for them, but excessive taxes are, as is crime. So also is terrorism; if they live in a building much higher and thinner than most, they are vulnerable to a 9/11 attack or simply a bomb placed near the building’s base.
The new concerns over 432 Park Avenue’s structural soundness are unsurprising. Like all the pencil towers, it was erected in a crazed big city real estate market sparked by the utterly unnatural monetary policies of Ben Bernanke, in which building ziggurats with zero potential return made good business sense. Like all such ziggurats and unlike say the Empire State Building (begun in 1929 in an era of much sounder monetary policy and less over-inflated asset values) its design was dictated by its appeal on sales brochures and not by its potential as a long-lasting and profitable development. Tenants of these buildings have tended to be absentee foreigners, seeking an investment in Manhattan real estate to shelter their ungodly-derived fortunes, used only when the home countries they have looted become too physically dangerous for them.
Absentee foreigners will learn about the building’s structural problems only when it collapses or is condemned by the building inspectors, wiping out their $30 million investment at a stroke. For actual residents, their investment is equally important but also the empty echoing caverns of a building that is largely unoccupied will be accompanied by the sheer terror as it vibrates and hums in Manhattan’s frequent winds, and they come to realize that the next bad storm may be the building’s last.
An additional disadvantage of pencil tower residence is the appalling local politics. New York has been notably corrupt and dysfunctional throughout the 242 years since the British hauled down their flag on November 25, 1783 – it is, after all the legendary home of Tammany Hall and Boss Tweed. Only under the great Mayor Rudy Giuliani (1994-2002) and his government-bloating successor Michael Bloomberg (2002-14) did its governance improve somewhat. But wealthy, even mildly conservative New Yorkers have not previously had to deal with a city government that openly hates them, in the way that say Brandon Johnson’s Chicago does.
Now it seems altogether likely that they will get one. Zohran Mamdani, who is currently rated over 90% in Polymarket’s odds of winning next week’s election, is a Marxist, who believes in state ownership of the commanding heights of the economy, which in spendthrift New York naturally includes retail and real estate. He is also a committed Islamist with no experience of living among ordinary people in the United States or holding a job – his upbringing has been both ultra-privileged and largely foreign. His attitudes and religion would not matter, except that believing as he does in almost total government control and ideological speech and behavior codes, the civil rights of the rich and especially of the Jewish non-rich are likely to be repeatedly violated.
The one advantage of Mamdani is that he may be so damaging and useless that New Yorkers will rebel and throw him out after four years, as they did David Dinkins (1990-94) whose ouster led to Giuliani and redemption. Alas, one cannot rely on that – Bill de Blasio (2014-22) very nearly as bad as Mamdani, led us only to the current somewhat inept Eric Adams. As for the Establishment-favored candidate Andrew Cuomo, he was a corrupt and authoritarian Governor of New York, condemning tens of thousands of grannies to death by forcing COVID-19 patients into nursing homes, so he represents merely a continuation of New York’s prolonged decline, sufficiently dull if unpleasant that he is unlikely to produce a useful reaction afterwards.
Then we have the Republican, Curtis Sliwa, a moderate, not close to President Trump, but thank God not the kind of sellout-to-the-left country-club moderate we all experienced with the Bushes, John McCain and Mitt Romney. As a frequent visitor to New York in the 1980s, whether from the suburbs or later from London, I was enormously reassured when traveling on public transport at night that Sliwa’s Guardian Angels (formed by that name in 1979) were patrolling the subways and looking to keep me safe from the unspeakable low-lifes that then infested them. Sliwa knows the city far better than Cuomo and infinitely better than Mamdani, with detailed local lore on the peculiarities of each neighborhood (and stories about how the Gambino crime family tried to rub him out in a taxicab in 1992). He also loves it deeply and would devote all his energies to bringing it back from the corrupt cesspit into which it is rapidly descending. He easily won the debates against the wooden Cuomo and the glib ignoramus Mamdani, for what that’s worth. For all but the most committed leftist, it is literally insane not to vote for him
But then a high percentage of New Yorkers are literally insane. That’s why they buy $30 million apartments in pencil towers (or would if they had $30 million).
-0-
(The Bear’s Lair is a weekly column that is intended to appear each Monday, an appropriately gloomy day of the week. Its rationale is that the proportion of “sell” recommendations put out by Wall Street houses remains far below that of “buy” recommendations. Accordingly, investors have an excess of positive information and very little negative information. The column thus takes the ursine view of life and the market, in the hope that it may be usefully different from what investors see elsewhere.)