710 Broadway loft sells at $1,000/mo premium over 2005 sale, almost
not a typical metric
One way to look at the March 1 sale of the full floor Manhattan loft on the 5th floor at 710 Broadway is that the clearing price of $2.035mm is a record for the building, exceeding even a sale nearly at The Peak (the 2nd floor sold for $2mm on June 5, 2008). Another way to look at it is that the last time the 5th floor sold was June 28, 2005, when it traded at $1.97mm. That 3.3% gain since 2005 works out to almost an additional $1,000 in value for every intervening month (actually, $956/mo if you are scoring at home with a calculator); by my lights, that takes away much of the lustre of a record sale. Yet another nearby data point to complicate your analysis is that the 4th floor sold on February 12, 2010 for only $1.535mm.
conditions vary, natch
This is one reason I love looking at Manhattan loft sales data: you have 4 data points in the same small building (hence, the footprint of each loft is the same, though ceiling heights and light may vary), 2 of which are the same loft, over more than 5 years (and different overall Manhattan residential market conditions), with different floor plans and lofts in varying states of ‘updatedness’. Let’s assume “2,400 sq ft” is appropriate for these lofts:
|June 28, 2005||#5||$1.97mm||$821/ft|
|June 5, 2008||#2||$2mm||$833/ft|
|Feb 12, 2010||#4||$1.535mm||$640/ft|
|Mar 1, 2011||#5||$2.035mm||$848/ft|
In terms of the physical conditions, the 2nd floor was in that state of live-in-it-as-is-OR-update/renovate that is common to many ‘classic’ lofts. I hit it twice way back in the day, the second time when it (finally!) sold in my June 17, 2008, another Broadway odyssey / 710 Broadway (finally) closes (immodesty requires that I ask you to be sure to read the mash note in the comment on that post).
I noted in January [January 9, 2008, 710 Broadway is slimmer after holiday break] that the layout was both quirky and challenging:
This “2,450 sq ft” space is relatively narrow at 21.5 feet, with the classic three windows in front (over Broadway) and in back; it is also tall enough (at 14 feet) to have a mezzanine over the kitchen and bathrooms with 2 sleep loft / office spaces. The footprint is challenging, so narrow that the 2d “bedroom” in the back is only 7.5 feet wide, with a long ‘dressing room’ between it and the window. The plumbing is in the middle of the loft, so the bathrooms are back-to-back and a long way from the bedroom.
There are no pictures of the kitchen or baths (and no bragging unless you count “jacuzzi”), which is consistent with my recollection that these elements are pretty dated.
If AJR is still a reader, I’d ask him if they left it as-is (is that one bathroom still the turquoise of my memory??) or updated; if they updated, did they take out the core (kitchen + baths below sleep lofts) and start over?
if timing is not everything, what is it?
In retrospect, that 2nd floor sale is fascinating because they were over-shooting the market even while the deepest Manhattan residential market ever was racing toward the peak. In the course of the year preceding the statistical peak in the overall Manhattan market, this loft was over-priced at $2.5mm in March 2007, for a long time at $2.295mm (from April 2007 into 2008), and at $2.195mm (briefly) before finding that contract at $2mm.
The 4th floor had almost the opposite experience. While the 2nd floor fought against market strength, the 4th floor is such a poster child for a frozen market sale that I am surprised I overlooked it at the time. Something happened that first summer, leading them to start and stop after 3 weeks. (If it was life, that stuff happens; if it was a tactical choice … oops.) But imagine if the 4th floor had been priced right and had stayed on the market long enough to get a contract before the Lehman hit the fan the day after they came back:
|July 2, 2008||new||$2.29mm|
|Feb 11, 2009||$1.795mm|
|Feb 12, 2010||sold||$1.535mm|
I never saw the 4th floor when it was for sale, but from the very modest broker-babble and from the floor plan (which you can’t see, unfortunately) this was probably in primitive condition, and in some ways offered less utility than the 2nd floor layout. The entire rear of the loft (the single largest open space) is labeled a "bedroom / studio", but was probably used as a studio, with "utility closet". The “sleeping area” has an en suite bath (the larger bath of two) and a large closet.
Especially with a primitive loft that almost any buyer would renovate instead of merely update, they were over-shooting the market as it entered nuclear winter with the Lehman bankruptcy filing on September 15, 2008. The overall market had started to thaw by mid-2009, but they were both still too high and a tired listing by then.
If the dated 2nd floor represented the peak at $2mm in June 2008, the primitive 4th floor sold into the (very extended) trough at $1.535mm in February 2010. That fall from grace of 23% is within the range of peak-to-trough declines in the overall market; perhaps toward the bottom of the range, but within.
That leaves the paired 5th floor sales to consider.
small gain, after (small?) renovation
Yes, the 5th floor just sold at the highest price ever in the building, but that is small beer where the previous record was a peak sale in as dated a condition as the 2nd floor was. More especially, if the 5th floor recent sale was all of $65,000 more than the June 2005 sale and that it claims a “newly renovated” condition. You’d think that a new renovation would earn more than that 3.3% over a 2005 sale.
Which leads me to 2 thoughts: the new renovation did not renovate much, and/or the spread between 2005 and 2011 sales is just one of those things that happens in an inefficient market. Personally, I go with the “and” in the and/or toggle.
When the 5th floor sold in June 2005, the floor plan was the same as in the recent sale except that the 3rd bedroom is now bigger. You can’t see that old floor plan (StreetEasy has it as “no listing associated with this closing”), but the old 3rd bedroom was narrower, leaving room for a “dining area” where the “gallery” now is. I see no other change in floor plan from the new renovation.
The 2005-era babble in our data-base sounds like the 2010 babble: “stunning full floor … loft with huge master bedroom, 2 interior bedroom/study, open gourmet kitchen w/ Viking/Miele appliances, Viking wine fridge, and 2 gorgeous marble architecturally designed bathrooms”, especially knowing that the floor plans are essentially identical. The surviving pictures show that there had been built-in shelves in the living room, show a lovely kitchen (there’s no kitchen pic in the recent listing) and the same marble bathroom except for some furniture. Very likely, the loft has been painted and the floors refinished, but the main re-do is the kitchen (if there has been a ‘renovation’ on any scale). The same shape on the two floor plans, maybe the appliances have been changed and (perhaps) the counters, as well: “renovated gourmet kitchen featuring granite countertops, wine fridge, and stainless steel Viking Professional appliances”.
Let’s just say that the market valued the new condition as no better than the 2005 condition. Yes, the March 1 sale of the 5th floor was at a record price; I just don’t think that is much to write home about.
© Sandy Mattingly 2011