July 23 (Bloomberg) -- When Abu Dhabi interests snapped up the Chrysler Building, the beloved 1930 skyscraper festooned with stainless-steel gargoyles and hubcaps, New Yorkers shuddered. Is New York still New York if its trophies are sold off to foreign interests? Why do peak oil investors love our landmarks?

What's next? The Seagram Building? And why not the Empire State Building? Or Rockefeller Center (again)?

The lust for landmarks comes from an intriguing mix of culture and cash flow. On the economic side, Manhattan looks like a good bet in the long term because rent-depressing Wall Street layoffs should be short-term if painful. Oil-patch buyers are not only flush with cash, the Chrysler's dizzying $800 million price for a controlling stake feels more like, say, $500 million if you're paying in a strong currency.

Unlike Americans, even oil-rich foreigners recognize that high energy prices and global warming will enhance the value of U.S. cities that offer alternatives to the auto. New York's mass transit may be antiquated, but it works. Angelenos pump $4.50 gas into their cars to go nowhere, thanks to world-class congestion.

Will the Middle Eastern investors who have poured billions into New York real estate shed tears, like the Japanese who snapped up corporate towers in the 1980s? Residential construction has exploded in New York in recent years, and may still take a fall, yet commercial building has grown far more cautiously. The Manhattan office-tower market slumbers in comparison to the building frenzy that engulfs the United Arab Emirates, Beijing, Moscow or Pusan, South Korea.

Office Bubble

By contrast, mirror-glass office towers remade Manhattan's skyline in the 1980s, a bubble pumped up by unsustainable Reagan- era tax gimmicks and lax lending practices very much like those that have wrecked housing finance (how quickly we forget). And New York's recovery from its 1970s brush with bankruptcy was much less advanced in the 1980s.

Foreign investors -- whether European, Middle Eastern, Latin American, you name it -- tend to value brand-name properties higher than do U.S. investors, who rigidly benchmark tangibles and ignore everything else.

Yes, new money is attracted to shiny surfaces and established brands. American architects are jetting to the Middle East to build megadevelopment landmarks. The Chicago office of Skidmore Owings & Merrill has designed the Burj Dubai to be the tallest tower in the world.

The instant skyline of Dubai's Sheik Zayed Road is a cacophony of name-brand icons and trophy wannabes. There are so many towers topped with domes, wedges and spires that Rem Koolhaas's Office of Metropolitan Architecture tried to differentiate a skyscraper proposal with a design that was self- consciously boring.

New York Exuberance

In many other nations, architecture is more deeply embedded in culture, and its role in creating genuine and authentic place is more widely recognized. The Chrysler Building commanded top dollar even though it doesn't have the large floor plates that many tenants seek. Its cachet comes from perfectly embodying a unique New York exuberance.

American commercial architecture is now the most timid and innovation-averse in the developed world. That makes genuine trophy buildings more valuable.

The New York Times may be annoyed by pesky publicity seekers clambering up its Renzo Piano tower, yet these stunts also confirm the building's skyline-altering aspirations. (Who would climb up one of the dozens of dull, me-too towers?) Now we know it's the city's latest icon, probably enhancing its value in the eyes of foreigners.

The Chrysler sale also disturbs with its implication that oil wealth and hypergrowth in China and India are shifting the economic center of gravity away from America.

We should be glad the petro-rich want to plow their huge gains back into America. After all, the U.S., with 5 percent of the world's population, is buying one-fourth of its oil. Until we stop whining about gas prices and put some real muscle into changing that equation, we'll see many more landmarks fall into the hands of foreigners whose wealth we've created.

(James S. Russell is Bloomberg's U.S. architecture critic. The opinions expressed are his own.)

To contact the writer of this story: James S. Russell in New York at jamesrussell@earthlink.net.

Last Updated: July 23, 2008 00:01 EDT