was the design / furniture CEO disappointed on sale of 150 West 26 Street loft penthouse?

probably (sigh)

Whether views as boasting or not, broker babble that touts the seller’s personal and professional aesthetic cred personalizes a marketing campaign to an unusual degree. In the case of the “2,070 sq ft” Manhattan penthouse loft at 150 West 26 Street (with a “staggering 3000 square feet of private outdoor space”) the gauntlet was thrown:

Designed and conceived by the CEO of one of the world’s leading furniture and design firms for his own personal use and featured in the New York Times, this rare property will not last

Consider the gauntlet thrown, then ignored. That babble was written (so far as I can tell) when the loft was first offered for sale, on November 26, 2012 when the ask was $5.495mm; the penthouse did not find a buyer until the contract was signed on July 12 (per our listing system; StreetEasy does not have that data point) for the $4.075mm that close on September 10.

Personally, I’d be reluctant to say something like “will not last” in listing material, but if I did I would watch to see if edits were needed. With an 8 month  campaign that featured price drops of $500,000 and $495,000, followed by a negotiation to a further $425,000 drop, well, “will not last” doesn’t quite cut it.

lovely design (stays) and furniture (goes?)
It is hard to say what condition the penthouse loft was in when the furniture/design CEO bought it in December 2007 for $3,283,856. When that marketing began in November 2005 the penthouse had not even been finished (“splendid and expansive Penthouse loft with soaring 12 foot high ceilings will soon grace…“). As described, the penthouse would be built with lots of goodies:

a private roof deck including an outdoor spa-hot tub surrounded by a lovely trellis wall. Views of The Empire State Building from the glass curtain wall living room are framed by the seventy foot long front terrace, and privacy and shelter abound in the expansive rear terrace. Four skylights illuminate all of the bedrooms and baths. The kitchen features Wolf wall ovens, Bosch D/W, Subzero Refrigerator/Freezer Drawers, and open slate counters with heavy gauge stainless steel double sinks. The Master Bath features skylights, double sinks and windows ensuring natural light

No photos from that listing survive on StreetEasy, but our listings data-base contains a rendering and a 2-bedroom floor plan that is rather different from the 2012 floor plan (principally, with 3 bedrooms and a differently shaped kitchen). The recent seller may have gotten the sponsor to build out to his specifications in 2007, or he may have erased those lines and started over after buying it. That would make a difference in guessing just how disappointed the furniture/design CEO would be, wouldn’t it?

Read the very detailed, very enthusiastic broker babble to see the finishes and proper proper names that the furniture/design CEO just sold. While the kitchen sounds as though it may have been built out by the sponsor to the same quality as the 2012 broker babble gushes over, the bathrooms, outdoor grill and shower, the indoor/outdoor audio, and all those HD TVs appear to have been added by the furniture/design CEO.

Is it possible that this penthouse with “2,070 sq ft” indoors and a “staggering 3000 square feet of private outdoor space” sold with a single listing photo? There’s only one on StreetEasy, none left visible on the listing firm’s  website, and none in our data-base. That’s weird, but possible. (You’d think the furniture/design CEO would be, you know, visual.) The only surviving picture does have lovely furniture; outdoor furniture, but still. one has to assume that the interior has even more furniture, and as lovely, if not more so. After all, the guy is a furniture/design CEO.

 let’s riff
For the first time on the new platform, here is a new link to the Manhattan Loft Guy post that I probably use more frequently than any other: the link to my May 6, 2010, riffing with The Miller on the value of Manhattan terraces, decks + balconies. The penthouse is by far the newest space in the building (it did not even exist in 2005) and was finished by the sponsor to be the wonderful-est space in the building (apparently). It should be more valuable than any other interior space in the building, which is the starting point for any Miller-riffing. (New readers, read the link, above.)

The highest price paid to date in the building was a private sale, alas. the “1,595 sq ft” Manhattan loft #901 traded for an even $2mm on November 12, 2010, or an uneven $1,254/ft. As a private sale, there was no broker babble, no pix and no floor plan. But we do have a later rental listing, which is interesting for a few reasons. First, the loft has a terrible floor plan (really, 1-bedroom plus [dark] office/den, and only one narrow wall of north windows. Second, there’s little bragging about the character of the space, but there’s this nugget: “furnished by Design Within Reach”. Of course, those furnishings were added after the place was bought for $2mm. The deed record has the same LLC (allowing for some typos) as the deed record for the penthouse, just sold by a furniture/design CEO. hmmmm ….

Anyway, that private sale at $1,254/ft is weird for being the highest in the building, especially given the challenging floor plan, and so represents the highest we could use as a building comp for interior space. But that sale was November of 2010 and that space was not finished like the penthouse. Generously, bump that comp up 15% for timing and another 10% for condition, and we are at (a very generous) $1,567/ft for 2013 era lovely interior space in the building. At that (elevated?) value, the interior of the “2,070 sq ft” penthouse would be worth around $3.25mm, leaving $835,000 of the recent sales price for the  three exterior spaces that stagger in at “3,000 sq ft”. That doesn’t work, does it?

That would imply an exterior value of only $275/ft, or only 17% of the value of the interior. The Miller might argue that the exterior space is too large (150% 0f the interior) for full value in the 25% to 50% range of interior that is his rubric. Andf maybe he’d be right.

The private #901 sale aside, the high value in the building was for a lower floor sale that was more recent. The “1,865 sq ft” loft #303 sold for $2mm on July 12, 2012, or $1,072/ft. While that sounds and looks lovely, it is still probably not in the finished class as the sponsor’s (and the furniture/design CEO’s) standards for the penthouse, plus it lacks the views and light from the rooftop. To be generous 9if arbitrary) let’s say the condition, light, and intervening year are each worth 10% for the penthouse interior compared to #303. That would take the penthouse interior to $1,394/ft, or only about $2.9mm, leaving the staggering outdoors at about $392/ft, or about 28% of the value of the interior. That works, for me.

I can’t figure out why an LLC would have overpaid for #901 (the asking rent with the DWR furnishing was only $8,000/mo rent) but that’s what seems to have happened. That LLC already owned the penthouse, since paying $3,283,856 in that near-Peak purchase (December 12, 2007). It is going to get way too distracting to wonder about why the penthouse owner since 2007 would buy a unit on the (former) top floor in 2010, paying top dollar by far. No more riffing…

Back to my first question: do you think the furniture/design CEO was disappointed to sell the penthouse for $4.075mm? I have to believe so. His LLC seems to have put some serious cash into the penthouse after purchasing it for $3,283,856 in December 2007, yet just sold it for (only) $4.075mm. And the LLC still owns the more pedestrian #901, which was purchased at a building record  $1,254/ft ($2mm in round numbers), then rented for (only) $8,000/mo since then. Common charges back then were probably around $2,000/mo, leaving $6,000/mo in income to cover any mortgage on, say, $1.6mm. Not gonna work….

The financial advisers to the furniture/design CEO are probably telling him or her to to stick to furniture/design and forget about Manhattan real estate. I doubt they are impressed with the penthouse journey or the #901 swamp.

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  1. […] with a full-price contract by June 24, closing on August 29. So: well-priced offerings do not last (yesterday’s post made the opposite point: poorly priced offerings last, and last, and last; sorry furniture/design […]

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