is publicity hurting 95 Greene Street resales?
[UPDATE – I changed the title and first sub-head just after posting, when I realized my main point was a different one … the perils of blogging!] [a substantive update from June 27 below]
even as #4A closes up 13% since 2006 bidding war
never seen a Christmas contract before
The recent press about the (continuing!) epic battles between the Soho loft condominium 95 Greene Street and the penthouse owners reminds me that I had put aside for future comment the sale of the Manhattan loft #4A at 95 Greene Street. The March 30 sale is hardly breaking news any longer, but let’s see what piqued my interest back in the day.
First, the simple math shows an appreciation of 13% from the August 2006 bidding war sale to the recent sale at $1.725mm. Second, somebody’s data system was working overtime, to record (as StreetEasy did) the contract on Christmas Day. Third, and most interesting, there may be an observable market impact from the Penthouse Follies, as this “1,205 sq ft” loft sold for less than two similarly sized neighboring lofts in December and April 2010. If any of this sounds interesting, read on … if not, see ya!
neighbors hating neighbors
Yesterday, Curbed hit the latest low-light in the battle between the condo board and the owners of 4 of the 5 penthouses: a picture of a costumed pair of deadbeats posted in the lobby. This follows action by the condo owners to change the by-laws to permit the condo to deny access owners-in-arrears to the elevator (especially painful for penthouse owners, no?) and to remove their names from the building directory / buzzer system.
The details of the dispute were presented by Christine Haughney in the New York Times on April 12 (A Condo, High-Profile Residents and a $40,000 Bill), a news item I discussed in a blog post that day that focused more on the ramifications for unit owners and how a coop might have had an easier time dealing with these deadbeats (95 Greene Street, deadbeat condo owners, and small building risk). I quoted there Haughney’s classic closing paragraph, such a classic that it bears repeating:
On April 4, [board president] Mr. Newhouse said, he met with Mr. Nahoum in Penthouse C, which was bare except for two office chairs. He said Mr. Nahoum blamed him for turning off his power, which Mr. Newhouse said only Consolidated Edison could do. He said Mr. Nahoum had said his neighbors were against him. Mr. Newhouse explained why this might be. He said he told Mr. Nahoum that failing to pay his common charges was “not a legitimate or legal way to address your problems.”
cash is not flowing (much)
I noted in that April 12 post that the penthouse owners probably owed the condo a lot more than the $40,000 noted in the Times article. If the situation has only gotten worse since then (as the super-hero photo placement implies), it would have gotten a lot worse for a building with only 25 other unit owners: the current sales listing of the 4 penthouses does not quote the common charges (is that supposed to be ironic??), but our data-base notes they are $4,785/mo. That is a big cash flow hole to be carried by the other 25 owners, presumably until the penthouses sell. (The building common interest for these four penthouses, per Property Shark, is 10.7%; not as high as I thought in April, but still a big cash flow hole.)
I can’t tell how long it was in place, but our listing notes for the #4A sale show that this unit had a $563/mo assessment that just ended in May “for roof and fire stairs repair”. That is essentially the same as the regular common charges for #4A of $579/mo, so it is likely that the deadbeats were also not paying about $4,700/mo in that assessment.
a market penalty for chaos (and cash flow)?
You’d think that a prospective buyer would have second thoughts about buying in to a condo that is fighting with a 10.7% owner, and you’d think that this wold depress the resale market here. I suspect you are right; the evidence is supportive but not quite conclusive.
As noted, #4A sold on March 30 for $1.725mm, or $1,431/ft for the “1,205 sq ft”, after having sold on August 15, 2006 for $1,525,001 (a bidding war bid!) in what looks like similar condition.
Loft #4D sold on December 13, 2010 for $1.825mm, or $1,518/ft for that “1,202 sq ft”, with a contract on October 26 the due diligence of which would have caught a smaller skirmish between condo and penthouse owners, if it caught a whiff of that coming cash flow problem at all. But that 6% premium for #4D over #4A understates the value difference, as #4D was sold to people who could not take possession for nearly a year due a then recently renewed lease for a tenant into November 2011.
Maybe there was a due diligence whiff (at least) in that October contract for #4D, because when #3F sold on April 15, 2010, that $1.9mm purchase price (after another bidding war) came to $1,582/ft for “1,200 sq ft”. (I hit that bidding war in my April 22, 2010, 95 Greene Street goes to war, closes up 8%.)
As I say, suggestive, though not conclusive:
- Mar 30, 2010 #4A $1,431/ft
- Dec 13, 2010 #4D $1,518/ft
- April 15, 2010 #3F $1,582/ft
no one’s Christmas was ruined
By the way, the thing about the Christmas contract date for #4A noted on StreetEasy is wrong: the date is December 20 in our data-base.
If you’ve stuck with me so far, thanks for playing!
[UPDATE June 27: per Curbed, the New York Post reports that the elevator service was cut-off June 17 and the
deadbeats super-heroes sued the condo for harassment, asking $2.1mm. Both sides claim victory, as the board was ordered to take down the deadbeat super-hero poster and to restore elevator service if (IF) they "start paying" the delinquent fees by July 1 (why only "start paying"??); total fees alleged to be due are now $125,000. I wonder if the deadbeats super-heroes end up paying the condo’s attorneys fees…. Undoubtedly, this is not over.]
© Sandy Mattingly 2011