Buyers Skip Mortgages at New Uptown Luxury Condo in Sign of the Times

Elevated interest rates may be scuttling some apartment deals. But the experience of a new condo on the Upper East Side suggests that not every buyer is being sidelined.

At the Wales, at 1295 Madison Ave., every apartment that has sold so far, or 10 of 20, has been a cash deal, in that buyers pulled from their own bank accounts to close the deal and did not use any mortgage financing. And the Wales is not alone. In the past half-year or so, as interest rates have spiked, the majority of buyers at new developments have been paying in cash, according to data from Corcoran Sunshine Marketing Group, a new-development-focused brokerage.

Prices at the 9-story, prewar former hotel that offers two-to four-bedroom units start at $4.5million. Adellco, the Wales’ developer, bought the Beaux Arts property at East 92nd Street in 2018 from DLJ Real Estate Capital Partners for $56.3 million, public records show. Arbor Realty Trust has provided $67 million in financing for the project, which began sales in spring 2021.