residential Manhattan square feet called “elusive” by NY Times, “fraudulent” by loft buyers at 1200 Broadway

haven’t we been here before? recently??
The big real estate story is Sunday’s New York Times was The Elusive Measure Known as the Square Foot, by Marc Santora, which everyone is linking to this morning (Curbed, The Real Deal, Brownstoner, True Gotham, UrbanDigs, and I will stop there). Manhattan Loft Guy hates to be left out of a party, so here is my contribution…. To me, the most interesting new fact from Santora is that specific buyers of an identified loft sued a seller, PruDe and an agent after their own three measurements (of 1,634, of 1,741, and of “nearly 1,800” sq ft) did not … errr … measure up to the number in the listing description (apparently, “2,170 sq ft”).

Of course, Manhattan Loft Guy readers are ahead of the game here, having read my rant against REBNY’s failure to lead on the issue of quoting square feet that REBNY knows is important to consumers but only advising REBNY members on how to protect the industry members from legal liability when (not if) consumers rely on the quoted numbers. That was my November 3, the square footage dilemma: REBNY “leads” by protecting brokers, not buyers, which I will refer to again after I hit the highlights from yesterday’s Times piece.

funny shapes are awkward, but not as awkward as lawsuits
I am not going to apologize for the way square feet are used in marketing Manhattan residential space (quite the contrary, as you will see), but these buyers had many ways to avoid the problem they now claim.  The lawsuit was over #5B at 1200 Broadway (in the storied Gilsey House), bought on April 5, 2010 for $1.65mm by two guys who were mad enough to sue over the square feet quoted in the listing. (There is no measurement in the StreetEasy old listing, which is hardly surprising for something that went to litigation, and no dimensions whatever on the floor plan from that listing.) I will take it as a given that the original listing said “2,170 sq ft” as the buyers alleged.

I can’t find an Offering plan for the Gilsey House, so I don’t know if there is a Schedule A that allocated the original maintenance obligations for each unit by square feet (some coop OPs have square footage in the Schedule A, some don’t). StreetEasy thinks that another “B” line unit here was “2,000 sq ft” when it did not sell in 2007, but I don’t know what source StreetEasy uses. Our data-base has a maddening number of different sizes for “B” line lofts at 1200 Broadway. In addition to “1,900” for #5B, we show different “B”s at “1,800”, “2,000”, “2,170”, and “2,200”. Some of that variety might be due to additional lofted mezzanine space that takes advantage of the high ceilings at 1200 Broadway, but I can’t account for this embarrassing mix.

The “B” line would present any geometry simpleton (such as myself) with a measurement challenge, as it is roughly a triangle, but with five sides instead of three. But someone with the motivation and patience could box it up and cut it up enough to figure out the space inside the exterior dimensions if s/he wanted to. That would give you the interior-wall-to-interior-wall volume, which is not necessarily what the developer did when the building was turned into a coop long ago. If that measurement started from the middle of the walls, for example, that could add 6” or more along the two sides that are exterior building walls, and 4” or so along the three sides that abut other lofts or common space within the building. I am going to guess that counting some of that “inner-wall” space could add at last 75 sq ft or more to #5B.

those unhappy buyers (who love their loft)
I have some sympathy for the two guys who bought #5B, but there are limits. I bet they were in the loft multiple times before they closed. I bet the show sheet they used to (probably) plan out their furniture scheme in the loft had the nifty REBNY disclaimer about “deemed reliable but not guaranteed; bring an architect/engineer to measure”. I bet their lawyer knows if the Offering Plan says anything about square feet (with another fancy disclaimer, if it does).

But here is the kicker: not only were they in this loft, they were in “40 or 50 apartments” that their agent thought met their criterion of “more than 2,000 square feet”. They knew how big “big enough” was, and this is the one they bought. If there was another loft somewhere that was bigger and/or better for less money, they would not have bought #5B. They saw “40 or 50 apartments”!

If the loft is really only 1,634 sq ft and if they really counted on it being 2,170 sq ft, that is a huge spread — 33% of the smaller figure. But they also knew (at some point) that an architect thought it was “nearly 1,800” sq ft, so their own numbers vary by as much as 10%. And, the PruDE lawyers no doubt pointed out that they were invited to make those calculations and measurements at any time.

They felt as though they had been cheated, but their legal case was so difficult that they dropped it. The good news is that “they say they love the apartment, [the bad news is] they are still bitter about the experience.” I bet all their furniture fits, just as they planned. I hope they continue to love the loft.

Note to self: check back when these guys sell (in five? seven? years). I wonder if they will use “1,634 sq ft”.

in which I disagree with True Gotham…
My November 3 post linked to the True Gotham video series on measuring square feet. Doug Heddings of True Gotham has always been a proponent of transparency and customer service in the business, and he has a strong statement in the Times article:

“I think all the weight that is put on price per square foot, especially in Manhattan, is ludicrous.” He is particularly skeptical of comparing apartments in different buildings based on their listed square footage.

“Very rarely can you compare two units unless they are units that are in the same building and were measured using the same standards,” he said.

I don’t think it is “ludicrous” but it is difficult, and it could be made easier if REBNY cared to take a consumer-friendly step that would make life (a little) more complicated for the brokerage industry (which is the only constituency in the residential resale business that REBNY seems to care about; unlike the commercial real estate industry, where many constituencies are REBNY members, and where REBNY has enforceable standards; see that November 3 post for more).

why square feet?
As I mentioned in that November 3 post, my Manhattan loft-centric view colors my approach, and is different from the perspective of agents who deal mostly in “apartments”. Indeed, I had Doug (and others) specifically in mind when I wrote this on November 3:

There are long-time honest agents who market traditional Manhattan apartments who find this whole topic distasteful and/or irrelevant. They believe that the pain caused by these measurements is simply not worth it. ….

I have heard such people often enough that I believe that they are sincere and knowledgeable about their market niches. But it is unfathomable to me that one could work with classic Manhattan lofts and not talk about square feet each and every time. Not just unfathomable, but impossible.

Every Manhattan loft is a set of exterior walls within which is x,xxx square feet, and a host of possibilities. Bathrooms and kitchens need not be where they are on a given floor plan. Interior walls need not exist (for the most part). Lofts should be compared across buildings on whether they are ‘big enough’ as is, and/or on whether they can re-configured to more sensibly fit a buyer’s lifestyle and needs on a reasonable budget. A loft square foot has as many square inches as an apartment square foot, but there is more flexibility in a loft square foot.

I also think that from a market overview perspective, it is important to have useful data based on square feet, an approach like The Miller’s. I concede that inaccurate, flaky numbers are not (very) useful data, but if we could get there, that would be great. But there is very little interest that I see among the powers that be to insist on standardized data. Sigh.

the magic bullet
There is no magic bullet! When I am king, I would enact this approach from my November 3 post, a rule that King REBNY could easily enact:

So perhaps REBNY would avoid that problem by requiring that agents either measure themselves, or pay someone to measure. ….

Use the exact Offering Plan number (if there is one), and disclaim that there are issues, and you have satisfied the (new) REBNY standard and are (likely) home free of any legal liability so long as you use the (no doubt, REBNY crafted) nifty disclaimer.

If you want to use a different number, justify it. If you do it yourself, save your drawing and pencil calculations (check the math, twice!). If you pay someone else to do it, save their work.

If (a) you don’t have a number in the Offering Plan, and (b) you don’t want to measure or pay someone to measure (it’s too hard!!), and (c) you don’t have another reasonable basis for estimating, then REBNY should have a rule that you cannot quote a measurement. At all.

Wouldn’t that be a better world?

© Sandy Mattingly 2010