numbers v. names
The big story in this report in The Observer last week about the sale of the “2,500 sq ft” Manhattan loft #3A at 10 Bleecker Street (aka “#3F”) for the full-ask $3.25mm was the identity of the celebrity buyers but the really interesting part came at the end of the article:
Ms. [Cynthia] Nixon and Ms. [Christine] Marinoni bought the place from photographers Brian Hagiwara and Brett Baughman, who purchased the apartment in 2007 for $2 million.
I don’t know these photographers, but I very much appreciate what they did, in buying a $2mm loft just short of The Peak and reselling (after a renovation, of course) for $3.25mm. Nicely played, sirs; nicely played.
Fortunately, it was easy to find a trail on these guys and it was gratifying to see that they are serial loft renovators. Two days before buying the to-be-renovated #3B in July 2007, these guys sold the “1,200 sq ft” loft #3A next door for $1.425mm. There is only one photo from that listing still on StreetEasy, but you will find the same green painting (wall treatment?) in that 2007 #3A photo and in the main 2011 #3B photo. It is hard to see whether they renovated #3B with similar ideas and materials as the half-as-large #3B, but the broker babble in 2007 was enthusiastically echoed in that for #3A in 2011, so it is likely there is a similar sensibility in each loft.
the price proves the babble
I confess not knowing what makes the #3B floor plan “architecturally important”, but have to assume that The Actor + Wife did not buy a “Magazine Quality” 4-bedroom loft to take down walls. I also do not know how all those walls create “an ethereal, zen-like openness”, but perhaps my imagination is jaded (or I am way too cynical about babble).
There is little detail in the babble about the finishes, but there are numerous promises about quality (from “soulfully gut renovated past perfection” to “spectacular Trophy loft” and that “Magazine Quality”) and a challenge: “the photos are only the beginning…. [i]f you are looking for a Downtown Loft … that is as pristine as it is authentic, you simply must see” this loft. They got a full price contract within 6 weeks, so the lack of details did not cause a problem; at least one set of buyers agreed that the photos were only the beginning and thought the babble was fully supported in real life. (Note: the Large Photos button makes it easier to see a lovely loft; I wish there were similar photos for the #3B, but the world seems not to run to my preferences any longer.)
That’s where the story was as of this morning: regardless of who the recent buyers were, in 2007 two photographers traded a “1,200 sq ft” fully ‘done’ loft at $1.425mm for the “2,500 sq ft” full gut opportunity next door at $2mm, and then developed that large loft into a loft showcase worth $3.25mm. It was probably fun for these guys, but the money calculation requires considering what they spent on the #3B renovation; anything close to $400/ft would eat most of their profit. At $250/ft for the renovation they would have pocketed a similar amount in the buy-fix-sell process.
you will never guess where they moved next
I wondered when I noted the history of these guys where they would go next, and whether there is another loft renovation in their future. The second answer is almost certainly “no”, as I found where they went in checking the building history again today for this post.
StreetEasy has a deed record today for #3B (their old loft) that was filed yesterday, which was in contract last week when I saw the #3A sale reported. Turns out that #3B sold on the same day as #3A, January 23. Turns out that the #3A-sellers-and-3B-buyers-in-2007 reversed course by buying back their old “1,200 sq ft” loft at the same time as selling “2,500 sq ft” #3A to the celebrity couple.
It does not look as though this was their plan until recently, until October 1 to be precise. These photographers signed a contract on October 1 to buy #3A back and then put #3B on the market. Their confidence in the quality and value of #3B was rewarded with that contract within 6 weeks at full price. I have a strong suspicion that they got squeezed a bit by their 2007-buyers-turned-2012-sellers, in buying back at $1,642,225 what they had sold in July 2007 for $1.425mm, but that is life in the big city.
Those #3B 2007-buyers-turned-2012-sellers went to market on July 29, 2011, presumably indifferent as to who they would sell to, so long as they got the best price they thought was available.
for fans of New York State agency law only
This discussion assumes that everyone involved in these transactions acted in full knowledge and compliance with the law, but in recognition that this must have involved some fancy dancing (and lawyer review). As of July 29, the PruDE team who had represented the photographers in 2007 when they sold to the #3A 2007-buyers-turned-2012-sellers were fiduciaries for those sellers, tasked by them to sell #3A at the best price to qualified buyers. That team would have handled the negotiation with the photographers in late September, around the same time that the PruDE team was about to sign on as fiduciaries for the photographers in selling #3B.
The PruDE team could have acted as Dual Agents in the #3A negotiations, changing their relationship with the #3A sellers from their fiduciaries in order to also act on behalf of the buyers; or they could have continued to represent the #3A sellers only (with the photographers unrepresented) through the #3A contract signing. In the #3B negotiations they represented only the photographers as sellers, though I assume if they did so, they had the approval of the #3A sellers.
Fancy dancing, indeed!
back to the real story
Agency disclosures aside, Sex and the City aside (even Wit aside), the real story for my Manhattan loft jones is that two guys with great taste renovated then sold loft the “1,200 sq ft” #3A in 2007 in order to buy (then renovate) the “2,500 sq ft” loft #3B at 10 Bleecker Street; then reversed course to buy back the smaller loft on the same day they sold the larger one (to Famous People).
Fancy dancing, indeed!
© Sandy Mattingly 2012