schizo seller succeeds with 224 West 18 Street loft by zigging, then zagging

success, but no points for style
The “2,002 sq ft” Manhattan loft #7C at 224 West 18 Street just sold at a very, very small discount from the asking price, so that’s an impressive bit of work. But I am intrigued about the flyer that the selling LLC took at a much higher price; that attempt lasted only 4 weeks, but I would love to have heard the conversations between seller and agent as the asking price changed:

(*Some of these dates are different from what appears on StreetEasy; in this kind of conflict I take the inter-firm listing system to be more accurate.)

Was that original asking price a clerical error or the product of some kind of miscommunication, or did they really immediately change their minds about the opening asking price?

When that change was made, did they agree to give the $2.6mm a limited time? There were 4 open houses between June 29 and July 27, so they should have had market response data (in this case, probably a no-response response).

The drop, when made, was all the way to $2.2mm, passing by the original (mistaken?) $2.25mm. Not a big thing, by itself, but odd in this context. The open house sequence recorded on the inter-firm data-base suggests that they were in business within 2 weeks of that big price drop, as the last of 3 weekend open houses was on August 12. Chances are, they got the offer that went to contract by August 23 either just before or just after the last open house.

The marketing campaign looks a bit more ‘schizo’ if you include a brief effort a year ago. The loft was offered at $2.45mm from March 8 to April 19, 2011, but pulled off the market because it was rented (per our data-base, apparently at $12,500/mo, through June 16, 2012). This year it was also offered for rent, at $13,750/mo and then $12,950/mo for almost two months before being offered for sale, but this time it was the sale effort that succeeded instead of the rental effort.

milking the cow
The recent seller bought loft #7C from the developer in 2003 at $1,247,800. Our data-base shows that it was rented out in March 2005 at $9,750/mo and in August 2006 at $10,200/mo. That tenancy probably lasted until the 2011 rental above (at $12,500/mo), as the history of confirmed rentals strongly suggests the LLC owner never intended to live there.

In addition to the sales efforts shown on StreetEasy in 2011 and 2012, the inter-firm data-base shows an attempt to sell before that 2005 rental, asking $2.25mm and $2.35mm for only two months; then again a year later before it rented in August 2006, asking (only slightly more reasonable numbers of) $2.295mm, $2.195mm and $2.075mm. Each effort was aborted when a new tenant appeared. (Another reason to think the 2006 tenant stayed into 2011.)

Fans of the Rent v. Buy Debate can do the math, but the initial math looks like #7C was a successful investment for the LLC, buying under $1.25mm, with monthly expenses that stayed under $3,000, and rents from $9,750/mo to $12,500/mo. The pattern into this year seems to have been to test the sales market at An Unreasonable Number, then find a new tenant.

Something changed in the LLC world this year, as this time the asking rent seems to have been too high, and the motivation to sell (at least after July 27) seems to have been much higher than in past years. The successful asking price of $2.2mm was not the same Unreasonable Number in 2012 that it had been in 2005 or 2006.

Add a gain of $945,200 (before expenses, of course) onto the ledger for the LLC from 2003 to 2012. If the initial investment was 10% and if the rent covered the nut every month, that original $124,780 was returned as $1.07mm (less round trip transfer fees of about $60k, title insurance and mortgage recording taxes of about $20k). Nicely played, LLC sir, nicely played.

With the rental side taken into account, the seller was less schizo and more reluctant. Prudently so.

a floor plan that under performs
This 2003 newly built condo was originally going to be part of the campiello Collection (it makes more sense for a “collection” to be three buildings, instead of just 151 West 17 Street and 150 West 18 Street; I don’t remember what happened). The look of these #7C and its neighboring units is like the look of the others that remained in The Collection: 9 foot ceilings, large windows, Poggenpohl kitchens and marble baths. I got excited about the floor plan until I looked at the pictures.

I can’t remember seeing another loft with a great paper floor plan that does not present well in real life. The paper (er, .gif) shows 3 south-facing bedrooms in a row, a corner living room with windows south, west and north, a kitchen and 2.5 baths down the middle, and along entrance gallery. In real life, however, the photos show less-than-brag-worthy light coming in those many and large windows, and the pictures do not show any view. At all. That is to say, that there are no photos with a direct view out a window. Darn.

By the way, we’ve been here before:

• April 7, 2011, 224 West 18 Street loft sells quickly, above 2007
• August 19, 2011, 224 West 18 Street lofts up 13% in a year, down 12% since Peak?

(These posts were about #4A and #8A, respectively, both 3BR+2Ba units that sold at higher prices per foot than #7C just did)

© Sandy Mattingly 2012