Huge bonuses coming and New York is already feeling the improvement. Of course that’s good news for Greenwich real estate – better than a sharp stick in the eye, for example, but the question remains, how good? So far, effect ranges from excellent to better, but the steak-eating fools at Delmonico’s singing happy days are here again will, if there is a just God, be laid off come December. And, as a couple of readers of this blog have noted, even the most cash-infused Goldman partner only needs one house in town, while the twelve unemployed former Wall Streeters each need to sell theirs. So we wait and see.
Bonus increases will have a limited impact on revenue, said Matt Anderson, a spokesman for New York state’s Division of Budget. Many payments come in stock that isn’t taxed immediately, and companies that disappeared in the crisis won’t be paying any bonuses at all, he said.
“While Wall Street bonuses are an important component of state revenue, they are not the only component,” Anderson said in an e-mail. “We continue to see substantial declines in tax collections across the entire budget. There is little prospect, if any, for a rebound in receipts by the end of the fiscal year that would remove the need for difficult deficit reduction actions.”
The number of Manhattan apartment sales increased 46 percent in the third quarter from the previous period, the biggest such gain since 1996, according to anOct. 2 report from Miller Samuel Inc., a New York appraiser. The median price of a luxury apartment in Manhattan in the third quarter was $3.9 million, up from $3.66 million.
Public anger over Wall Street bonuses, and the need to rebuild savings and pay down debt, may limit how much bankers and traders spend once they get their bonuses, said Charlie Attias, a senior vice president at Corcoran Group, a New York real estate brokerage.
“In 2007, we really saw people who were very confident, who knew that they will make a certain amount of money and it will not stop,” Attias said. “I think they are very cautious right now.” Delmonico’s, the landmark steakhouse a few blocks from the New York Stock Exchange, has seen traffic pick up and its catering business improve as firms start to take clients out in bigger groups, said managing partner Dennis Turcinovic, 31, after overseeing a lunch for 150 people last week.
The restaurant, which sells prime New York strip for $43, lost about 20 percent of its business after Lehman Brothers’ bankruptcy last year.
“If anybody does well on Wall Street, they come here and they spend their money,” Turcinovic said. “Some people come in and spend an astronomical amount of money.”