42 Hudson Street loft was a very tight fit to close at $1,474/ft, up a ton

the limits of good design
The “1,900 sq ft” Manhattan loft on the 2nd floor at 42 Hudson Street that recently sold is a lovely loft overlooking Duane Park (my personal favorite non-water view in Tribeca) that is designed within an inch of its life. Unfortunately for my buyers ho looked at it in the brief time between it coming to market and having an accepted offer, there were not quite enough inches, or some of the inches were not quite in the right place.

One of the wonderful things about Manhattan lofts that have been re-purposed from a prior non-residential use is their flexibility; often, if you have the money and the inclination, if you don’t like where the walls / kitchen / bathrooms / whatever are, you can get an architect to erase the lines on the existing floor plan and start anew. You will be limited by the window placement (almost always) and the location of plumbing stacks (usually), but the possibilities are more limited by budget than, for example, by the need to prevent the building from falling down if you moved interior walls.

That potential exists for the 2nd floor loft, I suppose, but there are some …. er … issues. First, the loft is beautiful, functional,  and highly efficient as is, with a brag-worthy set of finishes and materials:

recessed Lighting with Lutron dimmers, … Central A/C, Bosch Washer and Dryer…. Designer Kitchen features a White Carrera Marble Backsplash, Caesar Stone Countertops, Subzero Refrigerator, Bosch Dishwasher and a Gaggenau Range with Hood. The Master Bath has Solid White Carrera Marble, Rohl Fixtures and Custom Cabinetry, and the 2nd Bath features Calcutta Gold Marble, Custom Cabinetry and Rohl Fixtures

Second, those front windows (calf-to-ceiling, across a 22 foot wall) are “directly over picturesque Duane Park” (hinted at in that main listing photo).

Third, that highly efficient floor plan is a classic Long-and-Narrow, with plumbing grouped along the long South wall, two bedrooms in back splitting the 4 rear “windows”, and that … er … cozy “3rd Bedroom / windowed Home Office”, tucked into a front corner over Duane Park.

Net-net, this is a perfect set-up for loft lovers who love Duane Park, don’t need more than 2 “bedrooms”, wouldn’t make any expensive changes to the kitchen or baths, don’t need bedroom “windows”, and don’t have a lot of stuff. My folks loved the Park, the windows, the finishes, and could live with the rear “windows”, but felt squeezed by the cozy-at-7×9-less-a-closet “3rd Bedroom / windowed Home Office” and stumped the the lack of storage (compounded by no good place to add storage).

Count with me on the floor plan: there’s a reasonably sized 2nd BR closet in that bedroom, that closet shrinking the cozy home office in front, a modest walk-in in the master, and a small pantry off the kitchen. Period. The ceilings are hardly tall for a loft (babbling “high 9ft+ Ceilings” is oxymoronic), so there’s no place up high in the loft. The (beautiful) kitchen has high cabinets on only one wall, so there’s not even a lot of kitchen storage. And the most logical place to add a long closet (maybe 8 feet on the South wall between the elevator and stairwell) would cut into the front view, as well as narrow the front room.

This is a loft for grownups in a post-material phase. This is not a loft in which to raise a small child, let alone two, as there is no place for kids’ … er … debris (big wheels, toy kitchens, etc, etc). Alas.

well, hello, sir!
About those rear “windows” …. Yes, there are two windows in each rear bedroom, but (trust me) you don’t want to raise those blinds back there. We visited in daylight, but the (four feet?) outside the windows was pretty dark. Except for the lighted windows (four feet?) away, in the adjoining building. At one of which, an older gentleman was sitting and reading. (Four feet? away.) I can’t remember now if that neighbor was directly visible, or if there was a blind through which I could see his Hitchcockian profile, but I dropped the corner of the blind I had peered through too quickly to remember exactly what I had seen.

In other words, this beautiful loft with the sunny open (gorgeous!) views west is not for buyers who need any light in the bedrooms. Legality and building code aside, it is as if the windows were not even there, and you might as well consider artwork in the window frames, as you will never open those 4 blinds in back.

Turns out there is quite a market for a loft with this combination of features and … er … challenges. Streeteasy tells a quick story (to market on October 19 at $2.85mm, in contract by December 11, and [if you click around a bit] closed on December 21 at $2.8mm), but that story is incomplete.

Here is some detail about that first exciting from the inter-firm data-base:

  • Oct 18 new listing; open house set for Oct 21
  • Oct 23 open house set for Oct 28
  • Oct 24 offer accepted; open house Oct 28 cancelled

There were no more open houses. I believe the listing agent made appointments after the offer was accepted, but I can’t remember if we saw it in October or soon after the offer was accepted. In either case, within a week the body language for the listing was that an offer had been accepted at or close to the ask. That will put a crimp on all but the most motivated and ready buyers.

fill in the blank: “comping is ______”
Regular readers know the missing word is “hard”, and that comping is especially hard in small buildings with thin trading histories, and those folks will readily understand that comping is even more difficult with a (small) (thin) building that has a specific and unusual site advantage, as 42 Hudson Street does with that long view over Duane Park.

In this case, there has been only one sale in this 4-unit condo since 2005, and that was this same 2nd floor unit. So there is no helpful comp data, but that prior sale is fascinating nonetheless, in a can’t-stop-watching-a-car-wreck sort of fascination.

good timing or cojones?
When the guy who just sold the 2nd floor loft bought it in November 2009, the overall Manhattan residential real estate market was definitely in a thaw mode, even at the time his purchase contract was signed (October 8, 2009). Unfortunately for those sellers (and for fans of rational market theory) — but fortunately for the recent seller — the 2nd floor in 2009 was a significant market under-performer.

That listing description, photos and floor plan show the same loft in the same condition then, as now. But look what happened to it then, after coming out to a market still in the throes of a broad nuclear winter:

April 12, 2009 new to market $2.25mm
July 7   $2.2mm
Oct 8 contract  
Nov 16 sold $1.9mm

Here is all you need to see how deep red the blood was on those tracks: the November 2009 sellers at $1.9mm had been buyers in April 2005 (the last sale in the building before 2009, in fact) at … (wait for it) … $1,951,555. From their perspective, they sold at exactly the wrong time, suggesting that they really, really, really had to sell in 2009. From a buyer’s perspective in 2009, there was a significant bit of market uncertainty in early 2009, with much speculation as to whether The Market had it bottom, or would drop some more.

If you frequent real estate discussion groups with civilians (no slur intended, honest), like the boards on StreetEasy, you hear a lot of opinions about good times to buy/sell and bad times to buy/sell, and often see the less than polite suggestion that people who buy at bad times to buy, or sell at bad times to sell are (idiots), or worse. These spectators will often suggest (to others) when the right time to buy is. No doubt, compared to where The Market is now and not knowing what the future holds, 2009 was a pretty good time to buy a Manhattan loft or apartment; probably the best time to do so since 2006 or so. But it takes a person with conviction (sometimes, in technical terms, known as cojones) to buy when others are on the sidelines.

Normally, I would not put an October 2009 contract in that balls bucket (the thaw had begun, at least elsewhere nearby), but the pricing history shows evident highly local market uncertainty about the 2nd floor at 42 Hudson Street: it took from April to October to get a contract, with but one small price drop, and it took a 14% negotiated discount to get even that deal done.

Whether the 2009-buyer-turned-2012-seller was more smart, more lucky, or more brave, he made a deal that anyone could have made in 2009, but he was the only one to step up.

Three years later, he had no trouble selling for a 42% gain. This is not typical, but it is impressive.

Yowza.

(Countdown 10 … 9 …)

© Sandy Mattingly 2013

 

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