99 John Street loft sale is the very picture of motivation in a difficult environment

3 prices in 16 days, at a loss to 2008 buy
I find listing histories like that of the “677 sq ft” Manhattan mini-loft #1704 at 99 John Street (99 John Deco Lofts) fascinating. Sometimes a listing history reveals patience (which can border on stubbornness); sometimes hubris (or its opposite, modesty). This one is different, dramatic without being impatient.

The #1704 seller’s need to get out of Dodge is palpable:

Sept 4, 2008 sponsor sale $773,870
Oct 1, 2012 new to market $775,000
Oct 9   $740,000
Oct 16   $720,000
Nov 16 contract  
Jan 29, 2013 sold $700,000

What happened to this guy at the end of September? What clicked for him? All of a sudden, he had to sell, and he had to sell now. I was going to say, “no matter the loss”, but there clearly are limits, even for this guy; he held at the last asking price a full month to get a deal at a still further discount. Net-net, he got what he wanted: a quick deal at (what I presume to be) the best price available to him in The Market, though that was nearly 10% less than his original purchase (remember, that deed price is what he paid, including New York City and State transfer taxes, rather than the consideration paid directly to the sponsor). That net-net was, of course, further reduced by the sales fee and out-going transfer taxes (another $54, 775).

betting against the house is often a losing proposition
One could argue that even the decision to market #1704, by itself, indicates high motivation, in a circa 2008 conversion with 442 units whose sponsor is still selling units. In fact, of the last 13 recorded deeds, 12 were sponsor sales (#1704 being the lucky 13th), and the StreetEasy building page shows 16 other units in contract, 21 others for sale, and another 15 that sold since #1704 came to market on October 1. That is 65 of 442 units sold or selling in the 5 month period between putting #1704 for sale and closing. There should be no surprise that competition by original owners selling into an inventory dominated by the sponsor would feel rather cutthroat.

The only other time I have hit a sale at 99 John Deco Lofts the story was similar. In my September 8, 2011, John Deco loft resells off 11% since 2008, 7% off sponsor’s comp, I was struck by how heavy the sponsor’s inventory would weigh on a resale campaign; in that case with a similar result of an original owner having to take a significant hit from their purchase (in that case 10.8%, in this case 9.5%).

The “837 sq ft” Manhattan (mini-) loft #815 at 99 John Street might not have been the first resale at the John Deco Lofts (lofts started selling there in 2008) but it is the first that I have noticed. More interesting than the 10.8% decline from original purchase from the sponsor in September 2008 (2 weeks after Lehman; ouch!) is that this re-seller was still competing against the sponsor when he made the deal that closed for $687,000 on July 29.

The #1704 original owner spent some time this past September studying this history, no doubt, yet barged into the scrum on October 1, obviously prepared to discount quickly and often (up to a sharp point). He achieved his objective about as quickly as humanly possible, at a considerable cost. Good luck to him in the future.

Think of this building the next time someone makes a broad statement like “Manhattan is a seller’s market these days”.

© Sandy Mattingly 2013

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