making (no) sense of The Market / what did The Elf buy at 345 West 13 Street?

paging David Byrne
In this episode, Manhattan Loft Guy starts with a celebrity purchase, moans about transactions without brokers, touches on how difficult it can be to compare same-building loft sales, and finally (nearly?) goes bonkers on why ACRIS data sometimes needs a context, all without leaving 345 West 13 Street. Into the rabbit hole we go….

Curbed reports that A Famous Funny Actor is behind the trust that just closed on the Manhattan loft #5D at 345 West 13 Street, and The Real Deal accepts that as true. (Is "Level Four" the give-away?) Me, I don’t care, since this sale leads me to bizarre ruminations about how limited public information about real estate transactions can be in this town. And how hard it is to draw comparisons within the same building, even when the building is relatively new and all the lofts there started from the same set of high-end finishes.

The May 27 sale (deed filed this morning!) was at $4.2mm for "2,699 sq ft" and has that oh-so-irksome StreetEasy phrase "no listing associated with this closing". Without a listing description, it is (of course) hard to tell the condition of the loft, but it is undoubtedly similar to the condition in which it sold in March 2006 at $4.4mm (again, with no listing), and probably similar to the condition when it sold in December 2004 at $3,805,000 (with the — now traditional — no listing). That puts a present price/ft of $1,556 on this loft.

That sequence is pretty straightforward, from $3.8mm in late 2004 to $4.2mm in May 2010 with a bump in 2006 at $4.4mm. An intrepid reader on Curbed found an undated rental listing for this loft, which is most interesting to me because it has very restrained broker babble, though noting that the loft is "sun-flooded" with "pleasant (south-facing) West Village views" (i.e., no river peaks here, no uber-loft description). How then to make sense of the fact that a slightly smaller version of this loft sold on the second floor at only $1,132/ft last December?

a growing advantage for the larger loft?
Thankfully, #2D sold through a broker, so the description, pictures and floor plan are available. It appears that #2D has a slightly narrower version of the #5D floor plan, with both looking south in a similar orientation, but the ‘extra’ width on the higher floor being the master suite. I just don’t see a dramatic difference in finishes in the #5D rental listing and the #2D sale listing to justify a nearly 40% premium of #5D over #2D on a $/ft basis. Weird.

This spread is especially large given that these two lofts started with the same finishes when the building was newly converted in 1999. #5D sold then for $1.45mm ($537/ft); the smaller #2D at $995k ($450/ft) — so the developer thought the spread for the higher floor and larger space was ‘only’ 19%. As I say, weird.

even intra-building comping is hard
You will remember that #5D sold in December 2004 and just last week, gaining just over 10% if we can ignore the higher bump in 2006. Another loft at 345 West 13 Street has a similar pair of resales. #2A sold in January 2005 (one month later than #5D) at $2,618,000 ($1,103/ft for "2,373 sq ft") and then again in August 2009 at $3.4mm ($1,432/ft), gaining nearly 30% between these two sales on a $/ft basis. I don’t see anything in the listing descriptions that accompanies these two sales to indicate that the difference in market value from January 2005 to August 2009 had anything to do with an improved condition.

When you realize that the #2A resale was in August 2009 (toward the end of the post-Lehman nuclear winter for Manhattan real estate), the greater market appreciation of #2A compared to #5D is (for lack of a better word) weird.

one more weird
Since I spent a lot of time today clicking on public "sales" data today, I will share one more oddity about reported transactions in this building, just in case you have the stomach for one more warning not to take publicly reported "transaction" data at face value.

The loft #6F is thought by the city to be "3,210 sq ft". It sold in the initial offering in 1999 at $1,995,000, with an original listing description that noted a 300 sq ft terrace and north and east views that included (then, at least) full river views. The owners have done their best to pay real estate transfer taxes, as here is the recent history for the last three times a deed has been filed:

• Nov 20, 2009   $1,325,000
• June 13, 2008  $7,500,000
• Dec 27, 2007   $2,215,464

Obviously, there is no rational world in which these three "transactions" were at arm’s length, and it may be that none of them were as they appear.

Here’s a sketch of an idea about a theory, just from looking at the deed names and numbers. The 2007 deal was to clean up a single family residential trusts; I have no idea if they were trying to approximate market value.

The 2008 deal was with an unrelated party, the guy who has been living next door since 2002. I guess he wanted expansion space, but paying $1,700/ft  means either that he really really really wanted expansion space, or that other things changed hands when the $7.5mm check was written.

Finally, that 2009 "sale" (by the guy who still owns #6E) was to the unique buyer in #6A (is that loft on the other side of #6F? probably shares a wall). That #6A owner has been in the building since 2000, and it sure looks as though they needed just a little more space, so the guy who (might have paid as much as) $7.5mm for the "4,348 sq ft" #6F looks as though he spun off a little on the other side to the #6A owner, getting back 18% of what he paid for #6F.

If you don’t have that straight, don’t worry. It has taken me quite a while to click through deeds and ownership records, and i have lost myself a few times.

there is a point
The point of this latest (long) digression is to demonstrate (again) that ACRIS "facts" are sometimes both more and less than they appear. Use with caution.

temptation is hard to resist
OK … one more nugget and then I will stop. #6F happens to also have a Hollywood history (that’s a circle-back reference to $35D and The Elf up top), as Juliane Moore sold it in May 2003 at $3.65mm.

I’m stopping here. Really. I’m done. Enjoy the weekend!

© Sandy Mattingly 2010