trading 2,862 sq ft loft in Tribeca at 168 Duane Street for 2,500 sq ft Soho at 112 Prince Street

I guess they got tired of waiting to build their dream loft

The folks who just sold the “2,862 sq ft” 2nd floor at 168 Duane Street (in such prime Tribeca that it overlooks Duane Park) for $4.4mm just bought the “2,500 sq ft” 3rd floor at 112 Prince Street in prime Soho for $4.4mm (that loft is not just “a”, but is “the quintessential Soho residence”). This is one of those things that make me go hmmm … as it seems like such a straight-up trade, even dollar-for-dollar. While the trade of lofts worth $4.4mm might have something to do with a preference for quintessential Soho over prime Tribeca, I suspect it had more to do with the fact that this was not a trade of like for like. As is immediately clear from the Tribeca listing, half the second floor has been rented into 2015. For a buyer to combine the two halves of the floor requires either great patience (living in half until the other half tenancy ends) or money (buying out the 2015 lease); the sellers seem to have opted to get the larger space now, even if 12 blocks and one zip code north.

they didn’t want the loft renovation (combination) project, but somebody did

The recent sellers bought the “1,450 sq ft” loft #2N way back in October 1999, paying $736,000. We have no information in our listings data-base about the loft at that time, or any record of public marketing. Way back in 1995, we show the loft was a single bedroom, single bath, in “mint condition” that sold for $455,000. Just over three years after buying #2N, the recent sellers bought the “1,412 sq ft” loft #2S at $860,000, completing the floor. We have only a little bit of useful information about the loft in those days in our listings data-base (no pix or floor plan, alas) but the loft was then said to be in mint condition, with “SubZero, Kohler, granite, etc” (ha!), set up with 1 bedroom and 2 baths.

The joint listing has the floor plan that probably has been the arrangement that has existed all this time, with each half-floor loft having its single bedroom in the east corner at the windows (south in “S” and north in “N”, of course) and kitchens that back onto each other in the middle of the floor. Overall, the full-floor is a classic Long-and-Narrow, 27 feet wide, with big windows at each end and 3 small windows on the long east wall in the south unit on what must be an air shaft.

The implication of the joint listing is that the sellers lived in the north unit (“the beautifully renovated loft”); clearly, they did not live in the south half (leased until May 2015). Presumably, they settled on that arrangement (living north, renting south) for the last 10 years, presumably planning to one day combine the two lofts if (when) the need arose. The fact that they bought the 112 Prince Street loft (slightly smaller than the full-floor at 168 Duane Street, but much larger than the north half there) suggests that they finally did need the larger space but were tied into a long lease for half of what they owned on Duane Park.

Their buyer snapped up the opportunity to (eventually) combine the two halves pretty quickly. The full second floor at 168 Duane Street was offered at $4.45mm on May 12 and in contract by May 29 (sold on September 26 at $4.4mm), the complications notwithstanding. Assuming that the buyer needs the full floor, they will presumably buy from the condo that little elevator foyer connecting the two lofts to the elevator and stairwell and then do the classic Long-and-Narrow floor plan with a master and second bedroom splitting the south wall, possibly a third bedroom on that air shaft, and a long kitchen with an island on the west wall (or an “L” kitchen in the same area). Possibly, there’s a future bathroom to be added near those kitchen risers.

The interior photos in the joint listing must be of the north side only, showing what can be done with those (cast-iron?) columns and that magnificent long wood beam, if renovated similarly in the south end of the loft. Those front (north) windows over Duane Park can be emphasized even more by removing that bedroom, the large closet, and either removing that bathroom or reducing it to a powder room.

The opportunity to do that just cost someone $1,537/ft, with more dollars to come to do the combination.

is the combo worth more than each loft individually?

The full listing history shows that these sellers originally wanted to hold on to the #2S rental, but cash out the north half. But #2N did not sell separately, despite being offered for a year at $2.85mm and $2.75mm, and despite them having created “a modern masterpiece while preserving the architectural details” (with its “12 foot ceilings and 4 immense windows facing directly” Duane Park). Maybe the asking price had something to do with it. (Ya think?)

Of course the asking price had something to do with that, as The Market was unresponsive down to $1,894/ft, in “masterpiece” condition, so long as the buyers needed exactly one bedroom. Remember: this is the half with the much better condition and the much better view. Let’s guess that the fact that loft #2N did not sell for a year (the last 7 months at $2.75mm) means the loft was over-priced by at least 10%. That puts the ceiling for #2N’s value as a separate loft at about $1,700/ft. That’s getting dangerously close to the $1,537/ft that someone just paid for both #2N and #2S with the necessity of paying for the renovation that would rationalize the combined floor plan and (likely) bring the #2S interior up to “masterpiece” level.

In other words, that looks as though The Market thinks that #2N is worth more as a half of a future full-floor loft than it is as a separate 1-bedroom loft. Of course, this fits the conventional wisdom that (in recent times, at least) larger spaces are worth more than smaller spaces on a dollar-per-foot basis. I riffed on that conventional wisdom in my September 10, 2011, deconstructing NY Times article about combining apartments to increase value, and in a miscellany of posts since then.

what’s better in Soho?

As we know, the 168 Duane Street sellers cashed out at $4.4mm and immediately (OK, the next day) closed on the Prince Street loft at $4.4mm. That one, of course, was a full floor in move-in condition. If my ball-parking just above is reasonable (about $1,700/ft as the #2N ceiling), they paid more in  Soho ($1,760/ft) for a larger 2-bedroom coop unit than they could have gotten in Tribeca for the smaller 1-bedroom condo (max $1,700/ft).

The Prince Street loft has similar charms to the nicer half at 168 Duane Street:

mint renovated… with 12’+/- ceilings, cast iron columns and 6 oversized windows …. top-of-the-line, eat-in chef’s kitchen …. Exposed brick, custom built-ins and light oak flooring run throughout.The Southern end of the loft, separated from the living space by custom steel and glass walls, houses two pin-drop quiet bedrooms, ample storage and an en-suite master bath – replete with two person soaking tub, heated towel rack, and Lefroy Brooks hardware.The loft has been impeccably designed and meticulously maintained

One reason for the Soho premium is that this coop must enjoy significant income (from a commercial lease, presumably) as there are “no maintenance fees due for the next 7-9 years”. In addition, the (cast-iron!) columns here are more detailed than those on Duane Street, and there’s a chance that the new owners will make the beam on Prince Street look like the beam on Duane. That would be cool.

Loft voyeur that I am, I can’t help but wonder about the specifics of these two obviously related transactions. Both involve classic lofts in classic loft neighborhoods. For reasons unknown, the Tribeca-sellers-Soho-buyers chose to wait no longer to do the combination there of the two half-floor lofts they had owned and kept separate for 10 and 13 years. Eight million stories in the naked city, of course ….