Julian Schnabel hit by crunch

Julian Schnabel, the American artist turned film-maker, is feeling the pinch from the rapid drop in real estate values in New York. He has just been forced to slash the asking price for The Palazzo Chupi penthouse, part of an imposing, eye-soarishly pink development that he owns in Manhattan, from $29m to to $24m.

According to the US gossip website Gawker, the new price tag for the property, which is located in Greenwich Village, represents not just a reverse for Schnabel, but the end of an era of New York artists getting rich from their real estate sidelines.

It said: "Artists may or may not find the city's neighborhoods more affordable; but Schnabel and others can no longer expect to share in the appreciation of neighborhoods they make hip. It's fair to say that there won't be large projects like this in the future, and that Schnabel will be regarded as the peak of the heady days of the artist-developer."

The building was only completed a little over a year ago, and it was done so against fierce oppostion from the Greenwich Village Society for Historic Preservation, who abhored the colour of the edifice.

The president of the conservation body, Andrew Berman, said of the Palazzo: "It's a nightmare. It almost looks as though he went to great pains to make this building as ugly as possible and to make it stick out like a sore thumb."