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Wednesday, January 23, 2008

NYU Pays $4.2m for Condo to Lure Columbia Prof

From the New York Times:  Recruiting With Real Estate, by Josh Barbanel:

Columbia University, in a never-ending search for a larger campus, has long had an outpost for faculty housing at 455 Central Park West — 53 apartments in an 26-story tower attached to the French Renaissance chateau at West 106th Street. So it was something of a surprise when a foundation associated with NYU bought a large condominium in the complex. The unit ...cost $5.2 million ...

Catherine M. Sharkey, a Columbia law professor, lived in a 2,000-square-foot two-bedroom on the second floor of the tower building.

But last June, NYU announced that it had recruited Ms. Sharkey, an expert in product liability law and empirical legal studies, from Columbia. A month later the NYU Foundation signed a contract to buy the nearly 4,000-square-foot apartment in the same complex for use by Ms. Sharkey. The property records show that the foundation spent $4.2 million two weeks ago to buy an 80 percent interest in the turreted apartment.

Ms. Sharkey and her partner, Ina Bort, who practices commercial and maternity law in New York, bought the remaining 20 percent interest in the apartment for $1.05 million, but the foundation provided them with a mortgage to cover $650,000 of their share of the purchase price for up to 30 years (unless Ms. Sharkey leaves the university before then).

(Hat Tip: Above the Law and Brian Leiter.)

http://taxprof.typepad.com/taxprof_blog/2008/01/nyu-pays-42m-fo.html

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Comments

I'm glad student tuition dollars are going to good use!

Posted by: EB Guy | Jan 23, 2008 3:15:08 AM

Outrageous. Academics castigate other segments of society for greed and selfishness, but they're happy to grab all they can with both hands. And major universities are as profligate with money as are major corporations, it's just that the object of their bounty is faculty and administrators rather than executives. It's obvious that major universities have more money than they know what to do with. We should direct our charitable giving to places that have a real need.

Posted by: Rob | Jan 23, 2008 11:58:52 AM

What the heck is this "maternity law" that her husband practices? Is this really a practice area?

Posted by: Josh | Jan 23, 2008 12:30:27 PM

And of course the tax basis is reduced as there is no real value to a property which can't be resold in fractions. There is no reasonable expectation of a buyer. So it looks like a good deal for inheritance taxes and maybe someone can argue a reduction from the purchase price in any property taxes as well.

Is there no shame?

Do they get a luxury commuting allowance for the trip Downtown? Now that would entice a lot of people to NYU.

Posted by: Dewey Cheathem Enhowe | Jan 23, 2008 12:36:18 PM

And it is my understanding that Columbia professors and their spouses remain enitled to the use of those rent free apartments (even after retirement). Indeed, until they and their surviving spouses die.

Posted by: clarice | Jan 23, 2008 12:40:19 PM

My tax lawyer days are long behind me, but doesn't the prof end up with a *lot* of income from this deal? If so, will NYU gross her up?

Posted by: ronbo | Jan 23, 2008 1:00:15 PM

Uh, Ina Bort is a woman, so she wouldn't be Sharkey's husband.

Posted by: Half Canadian | Jan 23, 2008 1:30:08 PM

That is correct, that's why they are "partners" and not in the law firm sense.

And they have offspring!

http://nagorsky.typepad.com/chicago_law_class_of_95/2007/01/index.html

Posted by: Zee-Man | Jan 23, 2008 4:12:17 PM

"Kill all the Lawyers"
WS

Posted by: blackminorca | Jan 23, 2008 5:48:11 PM

This being a tax blog, the interesting questions are:

Are the property interests owned by NYU exempt from New York property tax?

Is her living in the apartment a taxable benefit, or do they take some kind of "employer necessity" position?

As opposed to the rest of us poor non-academic jerks who have to pay our rent and property taxes out of after tax income (the latter thanks to AMT).

Posted by: Daniel | Jan 23, 2008 6:07:17 PM

What I cannot understand is why Ms. Sharkey did not want to move downtown near NYU. It is so much more fashionable now than the Upper West Side, and that is not a nice part of the West Side.

Posted by: Fat Man | Jan 23, 2008 8:53:59 PM

Free market. It costs money to lure profs to stay competitive, and holding real estate like this will never be a bad investment for NYU (as it seems they will be holding this long term). Move along, nothing to see here.

Posted by: aaa | Jan 23, 2008 11:05:36 PM

Just how good is this woman? I hope this is not just another case of the Woman's lover (not partner) using university money to buy her out of her partnership (marriage?).

Posted by: davod | Jan 24, 2008 2:32:47 AM

Free market? Pleazzze! Since when is academia ever part of the free market?

So this is tuition dollars well spent.

Posted by: Joe | Jan 24, 2008 5:36:30 AM

not any different than what universities and boosters are paying for top football or basketball coaches.

Posted by: herb | Jan 24, 2008 7:03:53 AM

Just wondering if the property is partially exempt from real estate taxes since it is partially owned by NYU. Anyone have any knowledge?

Posted by: JBB | Jan 25, 2008 7:24:19 AM

Obviously the major universities have more money than they know what to do with. We should direct our charitable giving to places that have a real need,just spend the dollars.

by: stephen

Posted by: makati condo | Feb 11, 2009 7:15:09 PM