Magic Johnson, one of the most recent victims of the latest financial crisis
Over the past few years, the real estate market has seen quite a transforming phenomenon with a number of celebrities taking to property development. It could be said that more of them are attracted to the business due to the lure of easy money. The popular names that have explored luxury real estate as an investment are Paris Hilton, John Leslie and Leonardo di Caprio. While some of them make money by assigning their name to the project, others get deeply involved with their cash.
Retired basketball player, Magic Johnson is one of the most recent victims of the latest financial crisis. He saw Brooklyn’s 130 unit Viridian as a promising investment opportunity, which was being developed by 110 Green St. Development LLC, which later on filed for bankruptcy protection with the option to transform the unoccupied condos into rental apartments. This has now become the popular mode of approach in the market of luxury real estate, with the luxury condominium market in New York going more for upscale rental units.
In its filings in the U.S. Bankruptcy Court in New York’s Eastern District, the developer remarked that the unexpected downfall in the real estate market, specifically in the Greenpoint/Williamsburg market proved that condos were not quite the perfect way of using a property.
New York has started experiencing a brutal downfall in the prices of real estate properties. North Brooklyn has witnessed the average price of condos go down by as much as 9 percent during the last quarter of the year 2008 as compared to previous quarter and other areas have experienced further decline, and that too at a rapid pace.
110 Green St. mentioned in its filing that it went into talks with the leasing company to market the apartments in the form of rental units and it remarked that they received positive response from Fannie Mae to provide financing when The Viridian goes on renting.
