The Hunt for a Pied-a-Terre in NYC

NEW YORK -- All last summer, real estate brokers were waiting for the Europeans to show up and snap up some pieds-a-terre with their richly valued euros. The summer before, too, they had been waiting. But oddly enough, the Europeans never showed up.

The suburbanites did.

What is playing out in the market, according to Nikki Field, a senior vice president with Sotheby's International Realty, is a big change: "Regional people coming back into the city, usually to be near their grown children."

These suburbanites have the money to buy, and co-op boards are intrigued by these mature, well-off buyers, even those that have traditionally rejected anyone wanting to use a space as a pied-a-terre.

There's just one big liability these affluent baby boomers bring to the table in their quest for a "foot in the earth." Not toddlers, and not dogs.

What co-op boards really fear are grown children without real estate.

For many families the use of a Manhattan apartment is a rotating affair: the grown children may use it while at school or starting out and the parents may use it after that. That's why many agents skip the shifting sands of co-op boards altogether and direct clients toward condos.

However, with 85 percent of Manhattan residential real estate made up of co-ops, it doesn't leave a lot of inventory in condos -- even less in some desirable areas on the Upper East Side.

"The children are becoming a main situation," said Jacky Teplitzky, executive vice president at Douglas Elliman. "We used to prequalify buyers by financial qualifications and liabilities. Now, we also have to prequalify them on the age of their kids."

Even buyers able to pay a 50 percent down payment and who still have substantial liquid assets are looked at skeptically by boards because of college-age children.

"They are afraid the apartment is going to be used as a hotel," Teplitzky said. "It becomes like a transient apartment."

Sometimes, it's a choice between a dream apartment and the children. One of Teplitzky's sellers received an offer on a co-op apartment from a couple who lived in Long Island and wanted to buy the apartment as a pied-a-terre. Then the question of children came up. The co-op board, she said, was worried that their unmarried children would visit New York and use the apartment. The head of the co-op board came up with a solution: If the buyers would write a firm letter stating that the children would not use the apartment for any reason, they would pass. The couple wanted the apartment so badly, Teplitzky said, "they were willing to put it in writing."

Brokers say many of these suburban buyers lived in the city as young adults, then left to raise their children in homes with lawns. Now, Teplitzky said, some are "finding themselves being a little bored in suburbia."

A pied-a-terre evokes the whimsy of characters from Henry James or Edith Wharton novels sweeping in and out of New York or European capitals and back to their country estates, but really has no real estate definition. A pied-a-terre is a way of life.

It might be a $250,000 studio with a pull-down bed or an elaborately furnished one- or two-bedroom apartment that has the amenities of a hotel and costs more than $1 million.