‘architect-designed’ Tribeca loft does modern well, The Market is not as impressed as Manhattan Loft Guy

you could have fooled me

Perhaps I am just a sucker for lovely photos, but I found the listing photos for the “1,600 sq ft” Manhattan loft #2E at 16 Hudson Street to be fairly drool-worthy. I love the combination of old and new, the clean lines and the old timber, the shoji-like screens and the weathered white brick. I was nodding right along with the broker babble:

architect-designed 3-bedroom loft …. one is impressed by the level of finishes and soaring 12-foot beamed ceilings. *** Floors are reclaimed wide-plank oak throughout, perfectly complementing the history of the property.

(drooling …) (pic from Sothebys)

The charms of the interior aside, what makes the loft special is what you see out that arched window above: the “1,400 sq ft” terrace that truly expands the living area for as many months in the year that you care to use it.

the terrace is nearly the size of the interior (again, Sothebys)

The floor plan hints at one of the issues that the loft may have In Real Life: the rooms are not very big, so even with 12 ft ceilings and those (lovely! arched!) french doors, the living area pictured up top may not feel spacious. Is the kitchen proportionately too big?? For a great room that’s nearly 600 sq ft, it didn’t take a lot of furniture to fill the space up.

As I said, I love the look of this loft, and initially thought The Market must have loved it as well, given that it came to market May 2 at $3.775mm and found its contract by July 1 at the $3,662,500 at which it closed on September 26. That’s fairly quick work, at a fairly small discount to ask, notwithstanding the 4-month effort in 2015 to sell at $3.995mm.

we have a (very) close-by comp

The folks upstairs that sold the “1,965 sq ft” loft #4C did better, I think. They came to market on March 2 at $3.65mm and were in contract by April 2, closing on June 28 at $3.75mm, one hundred grand over ask. A lovely loft in its own right, but rather traditional as opposed to architect-designed, with a palette that (one blue wall aside) let’s the eye focus on the massive (rather primitive) columns and beams and the 13 windows. The loft looks perfectly lovely, especially the kitchen, but there’s probably a reason there was not much bragging in the broker babble.

The math for #4C works out to $1,908/ft, likely enhanced by a layout that is very efficient, easily yielding 4 bedrooms, only one of which is rather cramped.

the kitchen is not part of the 600+ sq ft great room, so it’s no surprise that the space feels bigger than #2E (thx Halstead!)

Isn’t this much more roomy than the top photo above?

the two exposures help it feel ‘spacious’, as do the many windows (again, Halstead image)

The #4C floor plan is not without problems, as efficient as it is. The plumbing lines the east wall, separated from all the bedrooms by the entry hall (er, gallery). So there’s no en suite bath. Market had no problem, of course, offering $100,000 more than the seller asked.

Loft #4C has some advantages over loft #2E: the sense of space, the actual additional space (and 4th bedroom) even though only “365 sq ft” larger, and the open views (including the World Trade Center). Ah, the beauties of even a 4th floor open view in Tribeca! Without doing a lot of bragging about the interior finishes, we know that #4C was valued by The Market at $1,908/ft.

how much was that terrace in #2E?

But #2E has the terrace, an uncommon feature in a Tribeca loft. And, possibly, a higher level of finishes (that “architect-designed” thing). If you were to net out the space and light advantages of #4C against the interior finishes of #2E, maybe you discount the interior value of #2E implied by the #4C sale just a little, say to $1,850/ft. That leads to a (to me) startling conclusion about how The Market valued the huge #2E terrace.

-> at $1,850/ft, the interior of #2E should be worth just about $3 million

-> #2E cleared at $3,662,500, leaving (only!) about $662,500 for the “1,400 sq ft” terrace (= $473/ft) (= 25% of the value of the interior)

Granted, that relative valuation fits within The Miller’s rubric for valuing outdoor space (see my uber-post of May 6, 2010, riffing with The Miller on the value of Manhattan terraces, decks + balconies), but just barely. And I would generally give the #2E terrace a premium for being so usable, so directly accessible from the living space, and for being so nicely finished (with irrigation and cooking gas). But that’s not how The Market looked at it.

The Market either discounted the #2E interior space more than I would have expected based on the oh-so-recent oh-so-nearby #4C sale, or The Market discounted the terrace more than I’d expect. (Maybe a little of both; we’re extrapolating.)

Color me surprised.

or maybe the architect-y thing in this Tribeca loft  is dated

Does everyone’s mind work this way? When I see broker babble bragging about finishes and claiming “architect designed”, I assume (I know, I know) the loft was done fairly recently, and by these sellers.

You wouldn’t know differently from StreetEasy, which reflects only that the recent sellers bought in 2005 for $2,511,000, without any link to that listing. But our data system contains the listing description from 2005, which is highly suggestive that the architect at issue was retained by the folks who owned the loft from 2001 to 2005:

Architecturally designed and stunningly renovated, this 2-bedroom + office/nursery, 2-bath home has it all. The top-of-the-line Chefs kitchen features custom walnut cabinetry, basalt counter, Wolf range, Viking oven, 42 Subzero refrigerator, Dacor microwave & convection oven, Bosch dishwasher, and storage galore. The design and execution of the interior space is nothing short of spectacular, with 12 ceilings and exposed beams, 23 custom 10 steel doors, antique walnut wide-plank floors, walnut closet interiors, huge windows in every room, beautiful finishes throughout, enormous utility room with washer/dryer, central heat and air conditioning, and more! Then there is the Terrace! – 1,400sf of fenced and finished space, with direct access from the living/dining room, beautifully decked with Japanese Ipe wood and fully land [the thing just ends there, likely having hit some ancient character limit in our system from 2005]

I can’t be certain without photos (not retained in our system, alas), but it certainly sounds like it. And The Market back in that day treated the loft as fresh, as it went into contract within two weeks $116,000 above ask. That Market also credited that seller as having significantly improved the loft in four years, as that 2005 seller paid (only) $1.15mm in June 2001.

Assuming (reasonably) that the 2001-buyer-turned-2005-seller renovated as soon as buying, the finishes would be close to 15 years old at the time of the recent marketing and sale. Lovely photos aside (drool!), maybe it just doesn’t show as well In Real Life as the photos suggest. So maybe the 2016 Market discounted the interior of the space more than my notional $1,850/ft, above.

what happened to my feet? and what do they do to my riffing?

Did you notice one significant thing different in the 2005 listing description than my earlier description of the loft? I’ve used “1,600 sq ft” for the interior here and in my Master List of downtown Manhattan loft sales under $6mm because that is what our listing system says, and our system tends to be based on an offering plan. The 2005 listing says “1,500 sq ft”. I’m not going to get into (today) how frustrating it is that this sort of discrepancy occurs all the time about something as basic as the actual size of a loft (my uber-post on that is probably my November 2, 2010, the square footage dilemma: REBNY “leads” by protecting brokers, not buyers), but let’s play with the smaller loft size for a minute….

If the interior that the old architect designed is really only “1,500 sq ft”, the interior valuation for loft #2E (implied by the sale of #4C, discounted mildly to $1,850/ft as above) drops to about $2.775mm, bumping the exterior portion of the observed market value to about $875,000, or $625/ft, which is about one-third of the interior value. Not a dramatic difference to my discussion above using The Miller’s rubric. Never mind … resume normal activity ….