Our alma mater, the Henry George School, lies in the pleasant midtown-east neighborhood of Murray Hill. Our alumni researchers decided to begin their economic explorations there, compiling a study of the zip code 10016. The area is fairly well off, though not as posh as some.

It boasts some of the finest Indian cuisine in its "little India" area on Lexington Avenue in the upper 20s. To the East, NYU Medical Center provides a large employer and community anchor. Land uses and assessed values are exceedingly varied. Note that the Empire State Building is just outside this zip, on the SW corner of 5th Ave. and 34th Street.

The area encompassed by zip 10016 contains about one half of a square mile, and has an estimated population (2005) of 50,883 (source: city-data.com). It has 7,504 real estate parcels, or "tax lots", 6,108 of which are condominium units. It has 23,970 renter-occupied apartments. The city claims the zip's total land value to be $5.12 billion (with a building- to land-value of 1.14), but we have strong reasons to question those figures. We begin with a look at four quite-similar buildings that have drastically different tax assessments.

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138-140 East 30th Street

This shows how confusing the rolls can be, sometimes. 138 E. 30th St., on the right, is listed as being 12.5 ft. wide, which seems right. 140 does not exist. But, 142, listed as 25 feet wide, sold for $4.3 million in January '07. Meanwhile, the 12.5 foot wide building at 138 sold for $2.375 million in 2005. But it seems now to be no more, having been subsumed into the nex tax lot at 142 East 30th Street, which the city says has a land value (25 x 98) of $2.15 million. It's a class 1 parcel; the '07 tax bill was $23,153. Because the land value is much higher than the building value, LVT wouldn't help this homeowner, alas.

308 East 30th Street

Another Class 1 property, this nicely-kept 3-story building just sold for $4.25 million. Oddly, however, the city lists the value of this lot (21 x 98) as only $345,000, while claiming the building is worth $2 million!

237 East 28th Street

Here's a five story building on a 25 x 98 lot, in the same nice neighborhood as the others. The city claims that this building is worth $571,000, while the lot under it is only worth $172,000! What's the difference? Well, this is a Class 2 parcel; it has 20 residential units in it. Assessments for class 2 tend to run much, much lower than those for class 1. This parcel sold in November '05 for $3.4 million.

And... there's a lot of variety in Murray Hill!

385 Third Avenue

This prime building lot was quite a bargain. (We'll get back to you on the number of floors in the new building, which towers above our photographer's field of view.) The building that was demolished to make way for it, however, was 3 floors, built in 1920, 42 front feet by 82 feet in depth. NYC considered land + building to be worth $516,000 in 2007, and the tax bill was $25K. In July of '06 the parcel sold for $16,245,859. Undoubtedly the new building, packed with snazzy condo units, will provide the city with quite a bit more revenue than before.

535 Third Avenue

Comparing these two parcels will give us some insight into New York's dysfunctional housing market. Although more people rent apartments in 10016 than own them, rentals are scarce. One-bedroom apartments in this neighborhood are renting for around $2,500 a month. Older rent-stabilized leases are worth big bucks, which means that class 2 buildings like this one, which are assessed on their income streams, tend to stay just as they are as the decades march past. The city says land + building were worth $1.37 million in '06, but in January of that year, it sold for $7.8 million. The new, big building next door is, of course, condos.

342 Lexington Avenue

Here's a gem. The city considers this 18 x 78 foot lot to be worth $288,000. It thinks the single-story building couldn't be replaced for less than half a million dollars! This is, of course, truly fantastic. Meanwhile, another parcel on this block, a four-story building, a foot narrower and not on the avenue (113 East 39th St.) sold in March '06 for $4 million.

394 & 396 Third Avenue

Let's consider these two buildings together. They are both in tax class 2, and are zoned C2-8 -- mixed use, allowed a maximum of two commercial and 8 residential floors (and possibly more with a successful appeal). Combined, they'd make a 49 x 63 corner lot. 394's total value is listed at $903,000; 396's at $2.12 million (the difference must be a matter of income stream). No doubt the owners would get far, far more in today's market, should they decide to sell. Notice the lack of windows in side of the neighboring high-rise!

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