I hear this a lot in Brooklyn. First, the reality is these units aren't very big (in fact, they are often smaller than cheaper units in Brownstones), so they're not significantly less efficient than "non-luxury" housing. Second, it's not like if the luxury buildings didn't exist the people who live there would just pack up and leave New York. Instead they'd just be moving into that renovated postwar that a lower-income person might have been able to afford.