Collect Pond loft at 366 Broadway sells at $918/ft after missing The Peak
going emo on a business transaction
There’s a mild puzzle in the recent sale of the “1,872 sq ft” Manhattan loft #3B at 366 Broadway (Collect Pond House) at $1.72mm, as it sounds like a beautiful loft that went for less than you’d think (well, than I’d think). But there is also a more emotional response, one of empathy, for a seller who tried to sell into The Peak but just could not get the deal done then.
Let’s start from a perspective of fellowship:
|July 20, 2007||new to market||$2.2mm|
|Jan 12, 2008||change firms||$1.945mm|
|July 13||off the market|
|May 6, 2011||new to market||$1.895mm|
|April 23, 2012||sold||$1.72mm|
In fellowship, isn’t it clear that they picked the perfect time to sell, by coming to market 3 calendar quarters before peak pricing was recorded in the overall Manhattan residential real estate market? Timing is not, as they say, everything. Timing is one critical aspect, especially in a dynamic market, but this history illustrates that even with perfect timing a loft will not sell from the wrong price.
“What if?” is a hard game to play empathetically. But if you believe that the current market values are within about 10% of Peak values, the $1.72mm observed clearing price implies that Peak value for this loft was around $1.9mm. You’d think that a willing seller asking $1.995mm at The Peak could sell around $1.9mm, but that did not happen here. Perhaps the seller did not give the $1.995mm enough time (less than 5 weeks), but the clear mistake (clear, in not very empathetic retrospect) was in taking 2 months off the market. Remember: peak prices were recorded in the 1st quarter of 2008, many from contracts signed in the last quarter of 2007, overlapping with the 2 month hiatus.
In retrospect, that was one very expensive hiatus.
The overall market in the second quarter of 2008 was characterized by strong prices but was not quite as deep a market. You’d think this seller could have gotten a deal then off a $1.85mm ask, given that it eventually cleared at a very-post-Peak $1.72mm; if so, like me, you’d have been wrong.
Abandoning any empathy whatever, look again at that 2008 listing history. Before September 15, 2008 (when Lehman went down) there was an active Manhattan residential real estate market. These sellers did not know Lehman was coming, but they could have seen market momentum was declining. In retrospect (curses!), they took off the last 60 days in which they had a good chance to sell.
That’s twice that these sellers pulled the plug on marketing during active markets (November 10, 2007 to January 12, 2008, and after July 13, 2008). I have highlighted the disappointed seller’s conundrum before, first in my November 15, 2010, flight or fight? the disappointed seller’s conundrum, 30 East 21 Street and 205 West 19 Street lofts edition, and then in posts riffing on that same theme (here’s one with a happier ending: my December 21, 2010, ground floor loft at 7 Worth St proves how bad 2009 was). At the time, there are no guarantees that it is better to continue to fight the market, by dropping the price again (and again), or better to flee and wait for better conditions. So be gentle, for there but for the grace of The Market Gods, go you, and I….
sunny + quiet + mint = less than you’d think
All that empathy and projection aside, $1.72mm had to be a disappointing sale on the merits. For reasons unknown, the listing description in the inter-firm system starts with “Sunny and Quiet Loft in Mint Condition”, an introduction missing from the public broker babble. Aside from the sound claim, the pictures bear out these claims. The floor plan is more Short-and-Wide, with a wide wall of south windows, and is a very efficient 2-bedroom+, with the “+” including a home office, a walk-in closet behind the kitchen, and a large laundry/storage area behind that.
Yes, it is a coop instead of a condo, and on a busy stretch of Broadway instead of on a charming (and quiet) prime Tribeca block, but it sold at $918/ft. Compare this sale to the nearby (and, if anything, even more busy) coop 395 Broadway, which has had 4 sales in the last 16 months, each at higher dollar-per-foot prices than #3B at 366 Broadway. One of those was clearly a total gut job, another was sold emphasizing “possibilities”; I hit some of these sales when they were fresh:
- February 22, 2012, 395 Broadway loft sells at $1,174/ft, a relative bargain to a gut job
- January 26, 2011, gut job loft at 395 Broadway provokes war, gets $1,000/ft
- February 23, 2011, renovated 395 Broadway loft is jealous of primitive top floor + of 505 Greenwich Street loft
Loft #3B also under-performed relative to a very nearby and fairly recent comp. If the floor plan of #3B looks familiar to you, it is the “1,872 sq ft” loft #7B upstairs that you are thinking of. I hit that loft when it closed on September 16 at $1.795mm in my October 3, 2011, 366 Broadway loft sells up 10% over 2004 but flat to 2007. (There is a discussion of the historical "Collect Pond" in that post, with some cool history links.)
That loft had the advantage over #3B of better light and some views from the higher floor, and the disadvantages of a challenging floor plan and a dated interior. In other words, that one needed significant upgrades to bring it to the mints of which #3B boasts. Yet it sold at a $75,000 premium to #3B.
And trust me: you will find on the Master List of Manhattan Lofts Sold Since November 2008 lots of Tribeca lofts that sold in less well-finished condition at higher prices than #3B.
Did I mention (yet, today?) that comping is hard?
© Sandy Mattingly 2012