how much were those roof terraces worth when 211 East 2nd Street loft sold?

probably $400,000 (but let’s see the math)
When the Manhattan loft on the top of 211 East 2nd Street sold on March 15 at $2,122,500 (the last 6th floor / penthouse listing is here, but the prior one with surviving pictures is here) the premium factors included “360 degree views of the city and … two spacious terraces for a total of 1,640 square feet”. Of course I wonder how much of that market value is due to the two terraces, and how much is due to the “1,860 sq ft” interior.

way high for way east
The building is a former carriage house at the far corner of Avenue B. To say it was a successful development is an understatement: three units sold in January 2008 (#4 and #2 as resales, #5 as a sponsor sale) at an average of $1,168/ft; the highest being the 5th floor sponsor sale at $1,283/ft. That Peak history is a rich platform from which to consider how to allocate the penthouse market value on March 15 between interior and exterior space. (I choose to ignore the September 2009 sale of the small unit on the 3rd floor as a nuclear winter price of $747/ft.)

In contrast to 11 foot ceilings on the lower floors, the duplex penthouse claims only 9 foot ceilings (not as dramatic a difference as at 99 Reade Street [see my April 30, 99 Reade Street and the value of low-ceilinged lofts in Manhattan], but probably a significant difference). On the other hand, the 6th floor has (somewhat) better views than the lower floors … and those terraces on two levels. Let’s play with the numbers a bit (oh boy!):

average, post-Peaked
You could make an argument for using the average of the three January 2008 sales as your baseline for comping in the building, or simply use the 5th floor as the closest-to-the-6th-floor unit. I prefer the average of $1,168/ft for the 3 sales, as there is a significant spread between the 5th and 4th floor units ($1,280/ft vs. $1,111/ft), but your mileage may vary. And I prefer to take a 20% haircut for a Peak-to-now adjustment, but you might go as high as 30%. Using 80% of the average Peak value, the “1,860 sq ft” of interior space for the penthouse should be worth about $1.74mm, or $934/ft.

the remainder is outside
That baseline would leave nearly $400,000 in value attributable to the two terraces that total “1,640 sq ft”, or just under $250/ft. What makes me happy about that result (after the pushing and pulling to get there) is that it is right around 25% of the value of the interior space on a per-foot basis. From riffing with The Miller on the value of outdoor space, that 25% is a comfortable result, taking into account that this space is disproportionately large compared to the indoor space (a negative for value) yet is directly accessible from the interior in both levels. Again, your mileage may vary as you apply some of The Miller’s rubrics from that May 6, 2010 post, but 25% has a nice round number appeal to it.

fun fact (that you will have to dig for)
One of the lofts below is owned by a multi-platform celeb, but will have to do some clicking to find out who. Avenue B at Second Street must be more chic than I realize.

© Sandy Mattingly 2011