almost a diversion, for being tardy
This one has been sitting in my To Do pile for a while, but is interesting enough for even a tardy post because it involves A Famous Building that (in this case, at least) has not held its own since the original sale in 2005. This case is the “1,681 sq ft” Manhattan loft #7B at 445 Lafayette Street (aka “Astor Place”, being that it is on Astor Place), purchased from the sponsor for $2,443,800 on November 18, 2005 and sold by that purchaser on July 22 for $2.395mm. (In fact, it leads to all sorts of places and times, as you will see.)
I say “wee bath” in the title, but the bath is actually a wee bit bigger than these numbers show. Because of the vagaries of how prices are recorded in New York City’s ACRIS system, that 2005 recorded purchase price includes the City and State transfer taxes (1.825%) because they were (by common convention in a hot new development market in Manhattan such as this building at that time) paid by the buyer, not the seller. The asking price in 2005 for loft #7B was $2.4mm, and the recorded purchase price is exactly that plus 1.825%.
Why does this matter? Because the NYC and NYS transfer taxes are paid by the seller on resale and not recorded in the purchase price, so the 2005-buyer-who-paid-transfer-taxes sold this Summer for $2.395mm and paid transfer taxes of 1.825% (again!), or $43,709. He netted $2,351,291 before considering other (smaller) transaction costs, so his bubbles-to-bubbles-bath on resale was $92,509, or 3.8%. Still a wee bath; just not as wee.
With only two bedrooms, there is an awful lot of room in this “1,681 sq ft” loft, enhanced by floor-to-ceiling windows. Of course, this is the building that put the sex in curved curtain walls, so there are curved walls in opposite south corners, in the master and in the great room. The money views in this building are on the other side of he building, facing north up the broad crossing of Fourth Avenue and Lafayette Street, and I cannot be sure how far the south views extend from the 7th floor. But one certainly hopes the babble is not being maddeningly precise but inaccurate in suggesting that the “undulating walls of floor to ceiling glass that maximize views of the Manhattan skyline”, if there is not much to ‘maximize’. I have reason to be skeptical.
bigger bath higher up (not much higher, but much bigger)
In wondering whether this guy’s experience of taking a small bath from his sponsor purchase in 2005 was typical, I noted that loft #9B sold last year at $2.375mm (I will trace that deed in a bit). That seller is hard to trace, but (trust me, and i will explain) took a real bath. Enough of a bath that I can conclude that Astor Place has a problem keeping its head above water (at least from the south), and that the 9th floor must have much better southern views than the 7th floor (even if the 7th floor views are “maximized” by the windows).
The #9B sponsor sale (offered at $2.95mm, per our data-base) matches up in price and deed names to this purchase on October 29, 2005 for $3,003,837 (the ask was $2.95mm, that plus 1.825% = the recorded price). Lofts #7B and #9B have the exact same floor plan in the exact same corner of the building, yet they were priced by the sponsor in 2005 $550,000 apart. What might account for the 23% premium of #9B over #7B? The only thing that makes sense is the view, or rather that #9B has a view and #7B has only “light”. Damn that maddeningly precise but inaccurate broker babble for #7B!
no bath lower
Let’s do one more, with a very different resale experience due to very different timing (luck!). Loft #6B is the last “B” line to sell before the 7th and 9th floor specimens, way back in another world, on June 27, 2007 for $2.71mm (I know that deed is #6B because our data-base links that listing to that sale price on that day). The phenomenon of new development resellers having hugely different results depending on which year they sold is not new, so chalk this up to Exhibit H or L in that series. The 6th floor “B” seller sold for $300,000+ more than either the 7th or 9th floor seller because that seller had the good fortune to sell into The Peak rather than after it.
It should not be a surprise that that #6B seller in June 2007 made a profit instead of taking a bath. Matching up sale dates and asking prices in our data-base, and 2007 deed name to sponsor deed name, confirms that the 2005-#6B-buyer-turned-2007-seller paid $2,392,887 on November 3, 2005, or nearly $400,000 less than it sold for two years later (before expenses, of course).
Note another thing about that 2005 price: it is evidence that the sponsor assessed view-independent values on this part of the “B” line as worth exactly $50,000. If that formula held for the 9th floor, the 9th floor original sale price would have been only $100,000 more than the 7th floor … not $550,000. In other words, the sponsor valued the view from #9B as worth $450,000 more than the “maximized” light in #7B in 2005, and The Market agreed by paying full price for each. Double damn that maddeningly precise but inaccurate broker babble for #7B!
seller has a thing for neighborhood icons
Voyeur alert: I have not discovered (yet!) where the July seller of #7B has gone, but the deed record notice address shows where he came from. To move to loft #7B in the gateway to
NYU-ville the East Village in 2005, he sold the “983 sq ft” Manhattan loft #10N at 252 Seventh Avenue (the Chelsea Mercantile) for $1.095mm on April 25, 2005, in a building which was as groundbreaking / neighborhood-making in its day as Astor Place was in 2005.
StreetEasy’s past listings don’t go back that far, of course, but our data-base shows that it took him just 2 months to get a contract for loft #10N, and that this loft has a studio layout: windows on only one wall, with a (dark) “home office” at the other end of the loft, behind the kitchen. (No doubt, everybody who lives in this layout sleeps in the work space.) That marketing did claim that the loft is “drenched with morning sunlight”, but does not claim a view, though it faces Seventh Avenue.
I can’t find the deed record for his original purchase at the Chelsea Merc (I am probably scrolling right past it), but our data-base shows that he purchased #10N in the original offering on October 27, 2000 for $485,000.
paging Patti Lupone
So even if you are inclined towards sympathy for new development buyers who don’t make a huge profit on resale (such as this guy at Astor Place), you may be heartened by his experience of selling a new development buy at the Chelsea Merc for more than twice what he paid for it. Of course, through the magic of leverage, his gain at the Merc was more like 500%, if he put down as much as 20% in 2000.
That’s how one gets one’s foot in the door of Manhattan residential real estate. That $500,000 profit from the Chelsea Merc would have made a lovely down payment on the 2005 purchase at Astor Place for $2,443,800.
© Sandy Mattingly 2011