Chelsea loft at 233 West 26 Street with classic floor plan + Empire State views sells for (only) $1,087/ft

the money shot is private from this angle in this Chelsea loft

Long-time readers of Manhattan Loft Guy know that I tend to stare at floor plans. In previous cases of trying to divine the sequence of usage and renovation implied by a current floor plan I have even claimed Floor Plan Whisperer status. In the case of the floor plan for the “2,000 sq ft” Manhattan loft #8E at 233 West 26 Street, however, the issue with the floor plan is not evident from the floor plan itself; you have to look at the broker babble. As quoted below, the babble is remarkably restrained, with perhaps the key selling point being the “open city views of the Empire State Building”. It can be a significant premium to get an iconic view from public space as large as the living room in this loft but, while Empire State Building is one of the icons in Manhattan loft neighborhoods, the two walls of this living room that are essentially glass from knee-to-ceiling provide a view of the Empire State Building perhaps only in a standing-at-the-window sense.

Here’s the babble about the interior, with the only real bragging in my italics to … er … underline how modestly the charms of this loft have been described:

10 ft ceilings; 21 oversized double paned windows; exceptional light; a very large and open living space; 2 bedroom, 2 bath apartment , wood floors throughout, washer/dryer in the unit, Southern, Eastern & Northern exposures, & open city views of the Empire State Building. The master bedroom is North facing and boasts its own walk-in closet and ensuite bath with double vanity and large shower stall. The second bedroom is also North facing with two large windows and plenty of space.

(I don’t consider it bragging about a loft to say there are “wood floors throughout”, or that there’s a washer-dryer, or that the master bath has a shower stall or double vanity; nor do I consider it proper boasting to claim a walk-in closet. But you may be more liberal in what you’d put in italics than I have been.)

My read of this very modest babble is that the interiors of the loft are … er .. nothing special (or, as they say, nothing to write home about) and the listing photos are perfectly consistent with that. (Note that there are no direct kitchen views, and no bathroom photos.) It’s the windows that make this loft: that there are 21 of them, that they are “over-sized” and double-paned, that they admit “exceptional light”, and, of course, that they have those open city views that include the Empire State Building. If you toggle between listing photos #3 and #5 you will see the same rooftop brick superstructure on the nearby rooftop. To get the view from #5, you almost certainly have to be standing between the couch and the window.

Yes, you can see from the Empire State Building from the living room windows, but note the then-current furniture array in the listing photos. The couch faces away from the Empire State Building view, and the ‘view’ from the chair with the best angle in that direction gets you only the pic #3 angle. You probably can’t see it at all (other than the tip of the spire) from the dining room windows on that wall.

If you play around with Google StreetView for this address, you will see that that the direct view from the front living room windows (at the top of the floor plan) is at the handsome Capital Building (the live-work coop at 236 West 26 Street with the [beige?] brick facade), with the side view looking at the living room corner at its (limestone?) neighbor to the east, and then on down 26th Street. Listing pic #4 shows that the north-facing bedroom views are not very open. Bottom line: it is fair game to claim an open city view that includes the Empire State Building, especially in marketing; just don’t think that people sitting down in the loft actually get to see that view.

Stand at that window, especially at night and especially with an adult beverage, and enjoy your icon.

how much is a glimpse worth?

To put the sale of #8E into perspective, the last sale in the building was a difficult comp a year ago, when the “1,450 sq ft” ground floor (and below) duplex loft #1E sold for $862/ft in much better condition than #8E (“newly renovated … architecturally-designed with impeccable attention to detail”). Another years before that, the “2,000 sq ft” #5W also sold in much better condition than #8E (“mint condition …. meticulously renovated to the highest standard … Viking appliances, two new baths with European fixtures, Bosch washer and dryer, … and it’s fully wired for surround sound and DirecTV”), for $937/ft. Obviously, this has not been viewed by The Market as a premium Chelsea coop.

Loft #8E took a while to sell in a very busy 2013 market, in retrospect due to some painful price discovery (omitting two 3-week periods off the market):

April 23 new to market $2.75mm
June 24 $2.25mm
Oct 14 contract
Nov 21 sold $2.175mm

You know from the headline that that’s $1,087/ft, which is 26% higher than the renovated but light- and layout-challenged #1E in October 2012 and 16% higher than the tres-minty #5W in December 2011. What ‘feel’ does the StreetEasy Manhattan Condo Index give us for the overall Manhattan residential real estate market at those times?

  • December 2011: 1,890
  • October 2012: 1,970
  • October 2013: 2,184 (the most recent month in the Index)

Thus, on timing alone, the Index suggests a same-loft sale in October (November) should have been 11% over one of October 2012, and 16% over December 2011. We are not dealing with same-loft sales, of course, but sales of a smaller and much darker #1E (in better condition) in October 2012 and of a same-size loft in much better condition #5W in December 2011.

In other words, the poor light and comparatively poor layout of #1E caused #8E with its view to much over-perform, despite the difference in condition. How much of the difference in favor of #8E is due to the view is especially difficult to say because of the other countervailing differences. Loft #5W is easier because it is the same size, and is a fascinating comp in that #5W in December 2011 and #8E in November 2013 perform exactly as expected by the Index, as though they were the same loft. The Index implies that the much better condition of #5W was exactly offset by the much better light and the open view that famously includes an angle for the Empire State Building. Wow.

To bring #8E up to the #5W (“the highest”) standard, #8E needs a new kitchen, 2 new baths, and perhaps only some detailing. Guesstimate $125,000 for the new plumbing rooms and we’d still have $75,000 left for a miscellany of finish upgrades to stay at a $100/ft budget for the “2,000 sq ft” #8E. (With floors, walls and windows in good shape in #8E, this seems quite reasonable without central air in #5W so long as no major plumbing or electrical upgrades are needed.) Under those assumptions, the much better light and the famously open views in #8E are worth $200,000.

Change the assumptions (or, learn the facts!), and you still have two market judgments two years apart that are perfectly rational if the value of the light + view in one is precisely offset by the value of the meticulous renovation of the other.

By no means can you apply this trade-off to any other pair of same-building lofts, but in this case of 2,000 sq ft siblings, it works. Perhaps coincidence is lining up adjustments for timing, condition, light, and view for this pair of neighbors in exactly the right mix. Wow, indeed.

Tagged with: , , , , , , ,

Leave a Reply