A place where price is practically no object
Mandarin's condos push up Hub average
(David L. Ryan/Globe Staff)
A look at the living area in one of the Mandarin Oriental condo units with bamboo flooring.
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Buyers are spending nearly $3,000 a square foot on condominiums at the Mandarin Oriental Boston - double the amount at any other upscale building - as the real estate slowdown barely brushes the city's luxury market.
In the third quarter, the average price for condos - influenced by the Mandarin's sales - jumped 29 percent, to $725,206 in 12 downtown markets, including the Back Bay, Beacon Hill, the South End, and South Boston, according to Listing Information Network Inc.
The median, or midpoint, condo price rose by 4.9 percent, to $460,000.
The Mandarin Oriental's hotel opened this month, but the Boylston Street development began closing on its first condo sales in September. The most expensive unit fetched $13.5 million, with several selling for $7 million or more, Link said. This month, a unit sold for $10.5 million, and the former
"This is New York pricing in Boston - but it's only at a Mandarin," said Curtis Kemeny, chief executive of Boston Residential Group.
The prices were for just the units themselves: Buyers paid much more to finish the units with kitchens, bathrooms, and things like marble floor tile.
Despite the high prices, things are rocky in the real estate market overall.
Downtown sales fell 2.6 percent in the third quarter - 988 units sold, compared with 1,014 a year earlier. Sales were depressed, in part, by the relatively small inventory of high-end listings, Blair said.
And the turmoil that hit the financial industry in October is expected to further reduce activity for the rest of the year. Downtown buyers often work in the city's financial district, which is expected to sustain heavy layoffs. One economist predicted Massachusetts may lose 7,200 finance industry jobs, including at Fidelity Investments.
"How the hedge funds and financial markets are going to hold up is going to be a direct indication of how well the Boston condo market's going to hold up," Blair said.
Kemeny said he believes the long-term prospects downtown are bright. He has sold 54 units for $1 million, on average, in his latest project, 285 Columbus Lofts. He's planning another condo building in the Seaport District, adjacent to the Barking Crab seafood restaurant. It won't come on the market until 2011.
"It's hard to build here, and it's expensive to build here," he said.
But "we believe that the market will be strong in 2010 and 2011," he added.
Kimberly Blanton can be reached at blanton@globe.com. 
