a very fruitful article / NY Times gets into generational conflict in lofts
the third angle: when ‘old’ people like it ‘as is’ and ‘new’ people want to upgrade
The front page Real Estate Section article in Sunday’s NY Times entitled “Which Building Improvements Really Pay Off?” has been a very fruitful source for discussion about lofts (although it did not focus on lofts).
My two earlier posts were about how this article illustrates how loft-buyers are different from apartment buyers and about the mistakes to be made when making improvements to increase Other People’s Value.
Actually, I thought this was the most interesting point in the article, and one that is very relevant for lofts:
On one side of the deepening schism are boom-era buyers seeking to spruce up their buildings to protect resale values and surround themselves with a level of grandeur commensurate with the size of their investment.
But some of their more tenured neighbors (a portion of whom continue to be branded themselves as “yuppie scum” or worse by the renters they displaced) resist fixing what doesn’t seem broken. Some also shrink from anteing up for what they consider frivolous plastic surgery on top of maintenance charges already swollen by the spiking costs of fuel, taxes and insurance.
I think this has the potential to be a much bigger problem for many loft buildings – more so than for apartment buildings, for entirely impressionistic reasons.
It is my sense that there are a good number of smaller loft buildings (under 30 units) in which there are a significant number of owners who have been there more than 10 years, and even some owners who are there 20+ years. For lack of a better term, we will call them Old Owners.
loft building demographics
Compared to people who have bought into these buildings in the last three years (“New Owners”), the Old Owners likely paid 30% or less of what the New Owners paid, and less than 20% of the current market value. Clearly, the Old Owners bought when the street life was different in many loft neighborhoods, and when the notion of “amenities” in lofts had more to do with working street lamps and regular trash pick-ups than with concierges and Fresh Direct lockers. Let’s just say that their attitude about what is ‘necessary’ may be different from that of recent purchasers.
In terms of income and working lives, rather more of the New Owners are monied professionals, while rather more of the Old Owners are retired or in the arts. The capacity of Old Owners to pay continuous maintenance increases may be strained, and their ability to pay an assessment for a capital improvement may be difficult.
I won’t identify the building (so as not to air laundry) but I am aware of a loft building of 15 – 25 units in which about one-third of the units are owned by old-timers. Every other year there are fights over efforts by relative new-comers to upgrade the lobby and hallways (last renovated at least 10 years ago) and to create a roof deck.
I love you, you’re perfect, now change!
New-comers who paid $1.5mm to live in an ‘authentic’ loft building, would like to see some upgrades, commensurate, they believe, with the investment they have in their living space. For old-timers this is frivolous at best, if not financially ruinous.
I see this as being more and more common in future years.
© Sandy Mattingly 2006
Tagged with: Amenities, Assessments, Generational Conflict, Improvements, Lobby, Ny Times, Roof Deck