NEW YORK CITY-According to real estate investment banking firm Granite Partners LLC, the only certainty when it comes to the price of land in New York City is that nobody knows what its worth. “With land today, you’re going to be wrong no matter what, because it changes daily,” Granite senior managing director Jerry Mason says. “It’s hard to determine where you are.”

“When we did the JFK Marriott in 1999 we came out of the ground at $22,000 per key,” Mason says, referring to the cost of land per hotel room. “I don’t think you could get close to that today. You’d be looking at a 10% discount at least. Having a site next to an international airport doesn’t mean much today.”

In Manhattan, land for hotel development, if it were available, “would be $100,000-plus per key,” Mason says, referring to the cost per room. But even those numbers are shots in the dark, he adds. “We don’t know where the number is. It could be that you can’t even establish a number today. We don’t have a reasonable comp after Sept. 11 to say this is where land should trade.”

Granite senior vice president Arthur Milstone likened land pricing for office space in today’s market to placing the cart before the horse. “The land component is at the end, not the beginning,” he says. “You figure construction costs, rents, reasonable rates of return, and then you figure out where the land can be priced.”

Still, Mason offers an “educated guess” that land for office-space development would fetch roughly $100 per sf. “Two years ago it was $300-plus, including land; six months ago, $450 to $500. Now we’re back to where we were three years ago.”

The retail market is in even worse shape, Mason says. “We have some prime-location land for sale on Long Island. We’re asking between $50 and $75 per sf. At this point, it’s unsaleable. The retail market is in such flux that I don’t know what it’s worth.”

Retail and residential space in Manhattan, however, has retained much of its pre-Sept. 11 value, Mason says, though price varies “on a block by block basis.” The industrial market, particularly on Long Island, “hasn’t suffered much. It’s fairly consistent,” Mason says.

Granite Partners is a real estate investment banking firm with offices in Houston, New York City and Los Angeles. It specializes in the sale of significant assets, portfolio dispositions and financing, working with institutions, public companies and private real estate owners.

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