price discovery is hard for Lion’s Head loft at 121 West 19 Street

even a loft that sells with the coveted green background can have problems

At (very) first blush, the “2,177 sq ft” Manhattan loft #3A at 121 West 19 Street (the vaunted Lion’s Head Condominium 2006 loft conversion in prime Chelsea) looks like another bit of bad news for buyers who are trying to avoid being steamrolled by The Market: sold at $2.375mm on October 16, a healthy $80,000 above its asking price. Having sold above the (last) asking price, this loft sale is marked on the Master List of downtown Manhattan loft sales between $500,000 and $5,000,000 with a green background in the “cleared at” column. But there’s more to the story than that, despite the wearing of the green.

If that last asking price of $2.295mm is legitimate (considered below), that was the third asking price in only the latest sales effort. The loft did not sell over 3 months at the end of 2012, or in 5 months spanning 2008-09. Granted, that first effort to resell by the original owner picked pretty much the worst 5 months one could have picked to launch a marketing campaign (unless one were immediately successful in securing a contract), but the whole effort was protracted, full of fits and starts:

Aug 4, 2006 new development purchase $1,731,025
Aug 12, 2008 new to market $2.9mm
Oct 22 $2.75mm
Dec 3 $2.6mm
Dec 17 $2.5mm
Jan 24, 2009 $2.495mm
Feb 4 off the market
Sept 12, 2012   new to market $2.395mm
Dec 20 off the market
June 26, 2013 $2.68mm
Aug 6 $2.525mm
Aug 28 $2.295mm
?? contract
Oct 16 sold $2.375mm

You have to appreciate that chase down from $2.9mm to $2.495mm, in the same way one appreciates a slow motion car wreck or the loft I hit yesterday (142 Duane Street loft sells up a million after chilly purchase, lovely renovation) that had a similar episode at a similar time. The guy was wrong about The Market’s appreciation for his loft in the 4 weeks he had before Lehman fell in which to make a deal, and he remained wrong as he chased a market with few buyers down, down, down, never catching up.

He found the right price when he came back in late 2012, but that was the right price for 2013 not for 2012. He aborted a second time.

For some reason he thought that starting again 6 months later $205,000 above the last asking price was the right approach, but this time he was more nimble, dropping in 6 weeks and again in another 3 weeks. (I am not convinced that the last price drop on StreetEasy really preceded the contract, as our listing system has nothing about this sales campaign, but let’s humor StreetEasy and the listing agent and treat it as though the loft was finally offered to the public at  a price below market, and that The Market recognized this fact and bid it back up to market value.)

Net-net, that’s only 13 months of active marketing across 4 calendar years, asking 9 different prices, and finally selling at a small premium to last ask (ha!) but 18% off the first ask. But he got out. At a (gross) gain of $644,000 (37%). You don’t have to be Charlie Sheen to call that winning.

caution: numbers on nearby lofts may cast a pall

Just don’t bother Charlie Sheen with the details on loft #8B, which also failed to sell after Lehman and also sold above ask in 2013. That one cost the original owner $1,812,485 to buy in May 2006 but earned that owner $2.8mm when it sold this past June, quickly (25 days to contract) and 10% above ask. Or with #9E, which resold in May this year at a 58% premium to the original purchase cost. (Loft #5A resold in June [only] 36% above the new development purchase, so maybe the “A” team can commiserate.)

I have a feeling that StreetEasy’s new daddy Zillow will not know how to handle … er … Zestimate lofts at the Lion’s Head; certainly not, Lion’s Head lofts like #3A.

for this loft, it’s not the finishes or the floor plan, it’s the windows

Loft #3A has the quality finishes common to the new development (jojoba dark wood floors, Poggenpohl, Viking, granite, and Kohler Purist fixtures, a 5 fixture master-bath with marble floors and Poggenpohl double vanity) plus the additional benefit of “an outdoor terrace … transformed into a mini spa sauna (the only outdoor sauna in NYC!) with a cedar lined enclosure”. (I have no idea if that is the only outdoor sauna in New York, but that certainly seems unlikely or, if true, unlikely to hold its solo crown.) The loft takes advantage of the 16 foot ceilings by partially duplexing a 3rd ‘sleep area’ and an office above the kitchen and dining area, yielding “2,117 sq ft” with 2-bedrooms+sleep-area+office. Plus that terrace-with-sauna.

It is weird that they marketed the loft without a single interior photo directly showing the 16 foot ceilings (“an art collectors dream”). You only get an indirect peak of the high ceilings in the 4th and 10th listing photos, but perhaps they decided that the window curtains don’t photograph very well. Those two listing photos are the only two with windows, yet they don’t show the windows. Only the curtains, closed. Of course, you know why listing photos show curtains rather than windows; because the windows don’t show anything. Rather, that there is nothing to see out the windows, but for a neighboring building.

If you click on Google view from the StreetEasy listing you can see how close the the north side of the Lion’s Head is to the abutting building on 20th Street sits; or look at the window photos in the #5A listing, with “a wall of glass looking north to open skies” only 2 floors above loft #3A. That will put a damper on marketing.

This much of a damper: $1,091/ft for #3A (unadjusted for tiny [dark!] terrace and sauna), compared to $1,165/ft for #5A, $1,364/ft for #9E, and $1,454/ft for #8B. But at least the #3A guy got out, and now can live in the light, with his 37% (gross) gain.

Yes, I think the Lion’s Head might break the Zestimator.

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