73 Worth Street loft goes a little above ask, a lot above 2010 (of course)


doing the Buy Low, Sell High thing

I never tire of these stories: a Manhattan loft with a past sales history that says interesting things about past market conditions, or buyers/sellers who achieve the real estate ideal of Buy Low, Sell High. One of the numbers in this history of past sales of the “2,176 sq ft” Manhattan loft #4C at 73 Worth Street is not (in Sesame Street lingo) like the others:

  • June 21, 2005 $1,379,728
  • Oct 6, 2005 $2.375mm
  • Sept 10, 2010 $2.1mm
  • Mar 15, 2013 $2.52mm

If you identified the 2010 sale as … er … incongruous, you are correct, Sir (Madam).

If you were tricked by the 2005 double sale, there is an explanation. The 2005 pair actually make sense if you understand that this new development on a very busy corner of municipal Tribeca had a very difficult birth, with a developer going bankrupt, a partially completed building for a significant time period, and original contract holders having been given rights to rescind. Our listings system shows that the contract leading to that June 21, 2005 closing had been signed on November 12, 2002. In between 2002 and 2005, the building went through the hell I first mentioned in my July 9, 2010, what happened on the 5th floor at 73 Worth? 3rd sale this year, and (eventually) came out, seemingly in good shape. Original buyers who stuck it out but who did not want to actually live there had the opportunity that the original #4C buyer had, to flip near a 7-figure gain.


hyper-local markets can be building specific

If the 2010 sale price for #4C was a one-off event, I’d consider it a mere headscratcher and close with some quip about The Market being irrational. After all, the overall residential real estate market in Manhattan experienced higher prices in 2010 (well post-Thaw) compared to 2005 (the very beginning, if not preceding, the Froth). But there was something about this building that caused The Market (not just a single buyer) to treat the building very differently than the overall market in these intervening years.


I hit one example in my June 26, 2009, 73 Worth Street closes by biting a very large bullet in one bite, as the “2,571 sq ft” loft #4B sold with a “June 2009 clearing price … 7% below the[] purchase price way back in August 2005”. I noted then that “[a]ccording to the building page on StreetEasy (here) there have been no sales in this building since 2005 — not for lack of trying”. That was the first resale in the building since 2005; the others (remember “not for lack of trying”?) started to pop in early 2010.


Two of the three same-floor sales that I hit in my my July 9, 2010, what happened on the 5th floor at 73 Worth? 3rd sale this year (above), showed the same pattern as loft #4C:  2010 sellers who got less than they had paid in 2005. Loft #4C fits that pattern, but with an even longer marketing campaign than the 3 5th floor neighbors. Look for yourself here, but the highlights is that it started in April 2006, had several periods of hiatus yet was continuously offered from November 2007 into November 2008 (remember: Lehman filed for bankruptcy on September 15), and was again continuously offered (with one 2-week break) from February 2009 to September 2010 when it (finally!) sold.


some numbers were scary, apparently

But for the consistent building pattern of 2010 prices below 2005 prices, you’d chalk this up to an unusually extended Thaw. I don’t know the details, but something about the building financial condition was scaring buyers in (at least) 2009 and 2010. Long-time (current??) Manhattan Loft Guy reader Jess provided a link in a comment to my June 26, 2009, 73 Worth Street closes by biting a very large bullet in one bite, about relatively large assessments, so that hints that the due diligence required here was deep, and fraught. 2010 buyers were getting a market discount for risk; the 2013 buyer of #4C got no such discount.


“Reasoning” backward from clearing prices, the #4C history implies that The Market no longer fears this building and that the 2009-2010 era financial issues have been resolved (or, are baked in to the operating budget and common charges). With all the 2005 resales at healthy premiums to sponsor prices, the then-newly-operating building was not scaring anyone in 2005.


Anybody care to share the details of why this 30-unit condo was so scary in the intervening years?


© Sandy Mattingly 2013


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