Chelsea House loft at 130 West 19 Street bounces back from nuclear winter sale

when up-up is more like down-up
The two times the Manhattan loft #7A at 130 West 19 Street (the Chelsea House) has resold, both sales have been arithmetically positive, which has certainly not been the case for all resales at this 2006 new construction condo loft development. That first re-seller could not have been too happy with the small gain, but that is what happens if you miss The Peak and (apparently) must sell into a cold market.

The top line numbers:

• Nov 9, 2011  $1,875,000
• Jan 5, 2010  $1,750,000
• Oct 11, 2006 $1,705,568

The last campaign was short and sweet, with loft #7A brought to market on June 20 at $1.895mm and in contract by September 12 at a tiny discount. Seller had a walk in the park on a sunny day compared to her sellers 22 months earlier:

First, note how soon after the Lehman bankruptcy filing the sales campaign began (25 days, in case you forgot). Second, note how quickly the sellers tried to react, with price drops in 33, 41 and 109 days, totalling 13.4%. Third, note that the sellers took a hiatus through the end of the nuclear winter, not coming back until market activity began to thaw. Yet the results are obvious, none of this worked to generate a contract until 13 months after they’d begun, with yet another price drop required.

That was one punishing market in 2009, even when it began to loosen up in the second half of the year. Those sellers received more in January 2010 than they paid in October 2006, but their big expenses for a sales commission and transfer taxes (together, $11,9,437) more than ate up that ‘gain’.

Evidently, they truly needed to sell, like most sellers who got frost bite in that market.

a small 3-bedroom
Loft #7A is “1,586 sq ft” of classic Long-and-Narrow footprint in a building that is far from classic loft. Windows only front and back, 2 bedrooms across the rear, with plumbing in the middle on both long sides. In this case they squeezed a 3rd bedroom up front, as many Long-and-Narrows do if they insist on having windows in each bedroom. (Compare this original floor plan for “A” lofts on floors 6-9 taken from the #6A listing during nuclear winter; note especially from that listing the even more severe case of frost bite there, with an eventual sale at $1.635mm on October 1, 2009. It can always be worse, right?)

In the world of 21st Century cookie-cutter condos, “1,586 sq ft” might be a generously sized 3-bedroom+ding area array. In the world of Manhattan lofts … meh. The utility of the extra bedroom comes at a significant price in reduced light and ‘volume’, especially in a loft with 9 foot ceilings. But note that this violation of my sensibilities was not reflected in the market, as #7A sold for a 7% premium over #6A in direct competition. $115,000 for 20 feet of carpentry (no closets!) is a pretty good return.

blood on the floor of the loft lab at 130 West 19 Street
Very attentive readers will know that I have hit the Chelsea House before, with posts on consecutive days 20 months ago.

In my February 11, persistence pays for Chelsea House loft (that, and the right price), I hit the then very-current deed for loft #7B, which suggested multiple themes:

a theme of price right to sell quickly, as it came to market at $1.25mm on November 8 and found a contract by December 23 at $1.231mm (the January 25 deed was filed yesterday). A slightly deeper look into the deeper listing history suggests a theme of persistence pays off, as this loft had been offered for sale from October 2009 into May 2010. And … from November 2008 into March 2009. Suggesting a theme of the chills of the nuclear winter, or the difficulty in pricing in a thin market, or the pain of over-pricing.

In my February 12, different story for this Chelsea House loft: started with Lehman, ended up off 22%, but up 6.5% lifetime, I went a little deeper into the sales history in this building to discuss loft #4F, which came to market about the same time as #7A the last time yet did not sell until 11 months after #7A that time.

this loft was actively for sale from September 27, 2008 until a contract two years later, except one six week period leading to a change in firms in Spring 2010 and a two month summer break in 2010 … with 8 price changes in those 20 active months

I talked about those two Chelsea House sales in the context of a classic seller conundrum, when The Market does not produce the preferred results:

If yesterday’s #7B took a both/and response to the disappointed seller’s conundrum (it did), #4F was a non-flyer, fighting every (bloody) step of the way. Note that #4F came to market 12 days after The Fall of the House of Lehman, so was fighting The Market at the beginning and through the depths of the nuclear winter that the overall Manhattan residential real estate market suffered from.

I put those two (then) recent sales into a broader context at Chelsea House, looking not simply at gains or losses since the sponsor purchases, but to dollars-per-foot, which I described as “unfair but curiously rational”; the last 4 sales were:

within a satisfyingly narrow range on a price-per-foot basis (satisfying, for those who prefer their markets rational). The last column below reflects the gain or (loss) since the original sale; those figures are all over the map, suggesting that The (current) Market valuation differences are different from the sponsor’s sense of the relative values among these lofts in 2005 and 2006.

Without that last column, you would never know from this table that #7B got squeezed by the market, or that #4F got a strong price. Isn’t this fun???

The 2011 market is much more kind for Chelsea House sellers than that relatively narrow range of $1,080/ft to $1,128/ft way back in 2010.

rent v. buy, pending
There’s no hint of this on StreetEasy, but we have a rental listing for loft #7A, offered by the new owners at $10,000/mo. If I am lucky, I will remember to check that in the coming weeks (months) to see what the loft rents for. The new owners are certainly more optimistic about the rental market for lofts in the $1.8mm price range than other lofts I have noted in the rent v. buy category.

See my December 2, 170 Mercer Street loft sells after 15 months, 15% off neighbor in 2005, which was mainly about the loft sale, but which included this:

Loft #3E was just bought at $1.8mm; it is now available for rent at $7,200/mo, after a renovation. Interesting stuff. (It is not obvious that this is #3E fmor STRIKE from the StreetEasy listing, but go to the PruDE website for confirmation.)

Also see my October 13, rent v. buy, or buy then rent in the loft laboratory of 448 Greenwich Street, in which I referenced a $7,300/mo rent achieved for a loft unsuccessfully offered for sale at $1.9mm:

The Manhattan loft #8F at 225 Fifth Avenue had been offered for sale for a long time at $1.9mm sale. The best and most recent comp (#8S) suggests that a successful sale could be had around that $1.76mm clearing price — a full $300,000 more than the 4th floor at 448 Greenwich Street sold for. #8F was then offered for rent (listing, here); and our data-base says it was rented for $7,300/mo

With 3 bedrooms and a dining area, #7A at Chelsea House has more utility than either of those lofts. More than $2,000/mo of more utility the rental market will eventually say. Note to self …

memory lane
For fans of the Chelsea House, here are the other 2 surviving Manhattan Loft Guy posts tagged with Chelsea House:

June 30, 2010, Chelsea House kinda sorta holds its own, reveals Truths in The Market
July 17, 2008, Chelsea House flipper did not reach for stars, but got out via 6 week contract

© Sandy Mattingly 2011