loft porn for loft lovers, as 112 Prince Street loft closes at princely $1,830 in upper prime Soho

right in line with expectations, set by recent neighboring loft sale

If you’ve been reading Manhattan Loft Guy for a while you know I am a snob for the more classic and loft-y lofts. So my second response to the main listing photo of the recently sold “2,500 sq ft” Manhattan loft #5 at 112 Prince Street was to wipe the drool off my keyboard. When I then noticed that it sold for $4.575mm, I was pleased that people putting real dollars into these things share that appreciation. Check off the boxes: tall exposed beam ceilings, cast iron columns, wood beams, huge windows. My third response was to observe that, nice as that loft is and nice as that $1,830/ft is, it is pretty much right in line with the last sale in the building (two floors below, on September 25 at $4.4mm), followed by (is this a Level Four reaction?) an appreciation for how two well-finished lofts with identical footprints in the same building can look so different.

It’s been a while, and that’s a lot to chew on, so let’s take this slowly.

funny price history, if you find loft numbers amusing

The loft needed a discount to sell had both a price increase and a negotiated discount before selling, ‘settling’ at a slight discount that was closer to the last asking price than to the first one:

June 22, 2013   new to market $4.495mm
June 24 $4.65mm
July 15 contract
Jan 8, 2014 sold $4.575mm

(I choose to ignore that post-contract off-the-market thing reported on StreetEasy and in our listings data-base on the theory that the loft was not marketed again after the first reported contract, so the “second” contract is more likely a data issue than a (truly) second contract.)

The mechanism that is The Market does not permit double-blind studies, but I would be fascinated to know what would have happened to this loft had it stayed at the first asking price, rather than jumping $170,000 two days after launch. If there was but a single bidder, it likely would have gone to contract at ask ($4.495mm), in which case the quick bump up made the seller some money he otherwise wouldn’t have gotten. But if more than one buyer was interested in bidding off that original price (an untestable hypothesis, granted), the seller might have gotten a higher price than $4.575mm.

The fair market value of the loft is tautologically $4.575mm. My rumination is about asking price dynamics. Priced as it soon was ($4.65mm), the loft was over-priced, in the sense of above-the-market, if by only a little (1.6%). That hardly seems a significant difference, but if priced below-market, if by only a little (1.7%), the loft may have attracted more than one bidder. (In a hypothetical efficient market with full information.) Bidders under competition have an unknown element to deal with that is missing from a simple bilateral negotiation, so such bidders have been known to pay more than market price. (Skip the tautology problem there, please.)

Again, in dollars not a big deal, either way. But this sort of history intrigues me enough to start spinning what-if scenarios. Pardon the interruption….

Did I mention that the loft is a classic beauty? Well appreciated enough that The Market snapped it up quickly at $1,830/ft despite being a small (5-unit) coop that (technically) can only be sold to an artist. Having “no maintenance for 7-9 years” helps, as does the high level of finishes, the 2-zone central air, all that light, and a prime Soho location.

same Soho building, same loft footprint, but different floor plan, different look

Don’t be distracted by the gap between closing dates: the 3rd floor loft was sold just before loft #5 came to market, and is a fascinating comp. First, same building, same footprint (d’oh). Second, the two sales can coexist in the notional rational market, allowing for differences in floor height and market noise. Third, they play to different preferences, with the 3rd floor covering the ceiling beams and placing less emphasis on the brick walls, plus having a more open great room in a classic Long-and-Narrow floor plan with two bedrooms splitting the rear wall. The floor plan upstairs is very different, fitting 3 bedrooms plus a media room (4th bedroom) along one long wall, while putting the kitchen on the opposite long wall from its placement on the 3rd floor.

I love the fact that there are such differences in two lofts, separated only by a loft between them. And I love the fact that this building has such flexible options, with plumbing stacks so widely separated as to permit the kitchens and the bathrooms to be in such different places in each loft.

Here is the all but contemporaneous listing history of the 3rd floor, which closed well before loft #5 by some quirks in party preferences or bank approvals or something:

June 4 new to market $4.495mm
June 22 contract
Sept 28 sold $4.4mm

Look again at the history for #5: to market the same day as the 3rd floor went to contract, (originally) at the same asking price. The 5th floor took 5 more days to get to contract (a trivial difference) and got $175,000 more (a not so trivial difference).

why $175,000?

Both lofts were marketed as in top condition, but if you read between the lines one of them has a renovation in its future. The 3rd floor splits the back wall into two bedrooms, but notice what is in the southeast corner of each loft, in the second bedroom on the 3rd floor: an elevator, babbled as “a manual elevator with plans in place to convert to automatic”. Apart from being impossibly charming for visitors, a manual elevator has to be worked … you know … manually, so shouldn’t be left anywhere other than the ground floor by polite neighbors. You won’t  make any friends by leaving it idle on the 3rd floor, so someone has to walk down the stairs to get it if you want to use it to take things down, or to walk back up to the 3rd floor after using it to enter the loft (with groceries, or furniture, or grannies) so that the next resident to enter the building doesn’t have to go searching for it.

That manual aspect explains why the 3rd floor would have the bedroom array that it does: they probably don’t use the elevator very often, so it is not so inconvenient to have it open into the second bedroom. (The “entry” on the 3rd floor floor plan is from the stairs, which is another hint of how that loft has been used.) But when the building goes to the trouble of converting the elevator to an automatic system, the elevator is suddenly much more convenient, and having it open into a “bedroom” is suddenly much less convenient. Hence, it is likely that the new owners of the 3rd floor will have to squeeze a smaller second bedroom onto that back wall, while allowing a proper elevator vestibule. Not such a simple change, with no option to steal space from the mater bedroom due to the bathroom placement. With that perspective, the otherwise weirdly shaped second and third bedrooms in loft #5 begin to make more sense.

Which is a roundabout way of suggesting The Market appropriately valued loft #5 over the 3rd floor, well within the range of market noise.

And with that, after so long way from the WordPress keyboard (a vacation trip to London plus business, people, and life, which are likely to recur but which I will resolve to let not be such long distractions), I will stop before I find something else to love about these lofts ….

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