ceilings + columns + beams + brick get authentic Soho loft huge premium, despite steps

bringing together Manhattan loft threads about walk-ups and character

Of course the recently sold “1,550 sq ft” Manhattan loft #3R at 132 Greene Street at the top middle of prime Soho is most obviously noteworthy because it sold for $2.351mm on a deal that took only 13 days off an ask of $1.995mm: even in these heady days, 18% above ask is impressive. But regular readers of Manhattan Loft Guy will also find that this loft as a third floor walk-up fits into my Old Grey Lady rant (December 4, what do manhattan lofts and walk-up apartments have in common?) and my appreciation for classic lofts but not for “ungentrified” broker babbling (my December 5, whatever an “ungentrified” Manhattan loft is, one at 33 Bleecker Street just got $1,317ft). I rejected the Satow Theory of a Stair Premium in that first post, so I don’t think the fact that loft #3R sold for so much so quickly is positively related to the lack of an elevator; but I always appreciate classic loft features, and that second post shows The Market does as well.

That Noho loft that sold at $1,317/ft needed a total gut renovation (it being “ungentrified” and all); this one in Soho does not need a gut (it has a kitchen with top appliances, a bath and a half of well-renovated plumbing, and appears to be in very good shape) though some may want to reconfigure the tight mezzanine, and it sold for $1,517/ft before adjusting for a terrace of perhaps 150 sq ft (say, $1,447/ft, adjusted). That’s actually a small premium over the ungentrified Noho loft just about 5 blocks east and one long block north, given the difference in condition.

Let’s talk about that condition, and configuration.

did I mention the loft-y bricks or the columns?

The first and third listing photos are especially delightful for lovers of classic Manhattan lofts. The “13’+/- ceilings” are supported by a massive wood beam and three cast-iron columns, and feature four knee-to-ceiling windows. One long wall is mostly brick, the other has some brick, and the narrow window wall is brick where it isn’t windows. Sitting in that tall open great room must be an extremely (and classically) loft-y experience. Did I hint (strongly enough) there are some issues with the configuration?

After you’ve clicked through the 6 interior listing photos and scanned the floor plan, you will notice some things that are not pictured directly. The master and second “bedrooms” for example, or the den, or the half bath upstairs. All these elements have in common the mezzanine that uses those “13’+/- ceilings” that keeps this from being a very limited loft with a single exposure and a high ceiling.

The den and the master “bedroom” above it fit under the “13’+/- ceilings”, so are more or less 6 1/2 feet “high”. The second “bedroom” sits on top of the shower in the full bath (see listing pix #5 and #3); again with a short ceiling. Here’s how awkward the mezzanine is: there is a straight stair to get to the master “bedroom” but the second “bedroom” needs a separate spiral stair because otherwise access would be through the master and through the (shared, dual-entry) half-bath. And no one is going to sleep (well, at least) in that master if there is someone else in the lower level using media without headphones, as the master is open to below over both the dining room (see listing pic #6) and the foyer.

The layout works for a limited set of buyers, and perhaps for them ideally for only a limited time. The best users will be those who need only one space for people to sleep, who can use that second bedroom as an office / guest room. Next best, people with one child small enough to fit into that small bedroom but big enough to navigate the spiral stairs safely. (The shared upper half-bath is more than metaphorically a life-saver.) I didn’t notice a ceiling fan in that long-range view of the master, but it will get warm up there without one, so far from that a/c unit hanging off the ceiling near the first window.

In addition to the volume and the classic loft elements, the loft boasts that terrace (more likely, a “balcony”, but let’s not keep quibbling). Listing pic #7 must have been taken in the morning, with the sun coming in over the buildings on Mercer Street that share the mid-block interior with the Greene Street neighbors. Looks like a lot of sun, at least in the morning, at least in the summer, on a balcony wide enough for a cafe table and more planting than the sellers have done. A usable outdoor space like this always enlarges a loft, especially one that is as space-challenged as this one.

the non-event next door is an interesting comp

Loft #3R came to market, as noted, at $1.995mm on June 14 and was on contract by June 27 at that premium price of $2.351mm. The loft in the front of the building competed against #3R head-to-head, briefly, and lost, badly. Loft #3F came out on April 24 at $2.05mm, dropped to $1,999,999 on June 19 (just after #3R came out), and retreated from the market on July 9, unsold. Obviously, the folks who bought #3R at $2.351mm could have bought #3F at a buck below $2mm (as could everyone else), but chose not to.

This pair will make Julie Satow of the New York Times beam: similar broker babble to that of #3R (“gorgeously renovated and peppered with unique details…. soaring 13 ceilings, original metal columns, exposed brick, wainscoting and an industrial-chic chef’s kitchen”; is that a tin ceiling??), with a larger footprint (our listing system has #3F at “1,800 sq ft” and #3R at that “1,550 sq ft”) all on one level and very good light (“flooded with natural light”), but a single bath. No terrace in the front, but there’s that elevator instead. The Market clearly preferred the mezzanine + terrace – elevator to the space + elevator. Curiously, the two units, for all there structural differences, have the exact same monthly maintenance of $1,855/mo.

That means that at birth, the coop issued the same number of shares to each, and got a certificate of reasonable relationship for that allocation (a proxy for equal market value) at that time. There’s no need for proxies in 2013: #3R is worth exactly $2.351mm, while the unknown value of #3F is something under $2mm.

I haven’t seen the two units, but my only guess from the listing photos is that the ‘character’ of #3R is dressed a bit better than the ‘character’ of #3F. The brick looks better in the back, the beam looks better, even the columns look better there. And that “industrial-chic chef’s kitchen” in #3F doesn’t look as chic as its counterpart in the rear.

Did I mention that comping is hard? It would be both easy and pretty cheap to add a mezzanine to #3F to duplicate the bedroom plus bath above the same elements on the main level. And cleaning up the classic elements in #3F to match the quality of #3R would take more talent than dollars. Even the kitchen can be spruced up in front, without spending anywhere near $351,001 on all these projects. That would leave #3F with similar quality, a bit more utility due to the hypothetical mezzanine, and an elevator instead of stairs (or a terrace).

Since I reject the Satow Theory of a Stair Premium out of hand, all I can offer is that the condition and the terrace make the difference between this sale and this non-sale. That hardly seems rational. but it also seems to be true. Somebody overpaid for a terrace who didn’t want to buy + fix.

(Cue the grumbling by efficient market fans, and by people who think walk-ups have no premium value, as such.) Grumble, grumble.