different values to different buyers
I am not going to say that The Guy I profiled yesterday who traded one small loft at 150 Nassau Street for $876/ft for another small loft on the same floor at $1,020/ft kept me up all night, but I will say that I woke up (still) thinking about him this morning. There’s the sense in which he paid about $100,000 for a view that The Market had valued in 2003 at about $116,000 (as a much higher part of the total value) and that The Market in 2010 valued at (only) about $33,000. There’s the sense in which The Guy is the unique buyer for The View, as someone who had lived in a no-view unit on the 9th floor and so might over-pay for The View. There’s the sense in which values within the building may have shifted in the 7 years since the building was converted to a loft condominium.
The outline of the story is in that post yesterday, bass ackwards at 150 Nassau Street?? as lofts are sold low + bought high, with an agency twist, about The Guy who bought #9E at 150 Nassau Street on November 3 after selling #9A a week earlier. Functionally, the two units are the same: both small one bedrooms in the former office part of this lovely building built at the end of the 19th century (that one is 606 sq ft and the other 668 sq ft seems hardly material). In condition, they must be exactly the same, with the same kitchens and baths with which they were converted to residential in 2003.
The two units were exposed to The Market from May into July, for anyone to buy. The fact that the seller of one became the buyer of the other remains intriguing. I have (mostly) stopped wondering how the same agents were on three sides of these two sales (mostly), in favor of wondering about What Is The View Worth? if it cost one particular buyer $100,000 but anyone else could have gotten it for only $33,000. And I will try not to get distracted by the very rich history of the building revealed in the Landmarks Preservation Commission report on the building, at least until I am done with The View for today….
I probably should be more interested in the #9A buyer, and less interested in The Guy who sold #9A to buy #9E. After all, that #9A buyer (who paid $585,000 for No View on October 27) also had the chance to buy The View in #9E (which the #9A seller bought on November 3 for $618,000).
That #9A buyer preferred to spend $585,000 for No View rather than $618,000 for The View in #9E.
That #9A seller preferred to buy The View at a $33,000 premium over #9A and to incur another $65,000 or so in transaction costs in selling and buying to do so.
Maybe the #9A buyer is a resident at Beekman Downtown Hospital, just down the street, and simply plans to sleep whenever he is in the apartment. Whatever his motivation and means, he is my poster child for the poster captioned Different Buyers Value Different Amenities Differently.
In turn, the #9A seller sits in the Manhattan Loft Guy poster collection with the caption Some People Will Overpay For A View.
There is an interesting question of whether the market value spread between View and No View units is as small as these two 9th floor sales imply, or whether the sponsor was right back in 2003. I don’t know whether there is enough truly comparable sales data at 150 Nassau Street to figure that out, and I am not going to try today. Instead, let me go back to the Landmarks report. (Stop here unless you are a history buff.)
The Google is my friend (it introduced me to LPC)
In clicking around the inter-tubes yesterday about 150 Nassau Street, I was impressed by the detailed description of the building on City Realty … until I went deeper into the Google results and found that the apparent source for all that detail was the June 15, 1999 report of the New York City Landmarks Preservation Commission.
I am less interested in the architecture (though it is a handsome building, no doubt) than I am in the history of this part of Manhattan, but here is the nugget of the description:
It is one of the earliest, as well as one of the earliest extant, steel skeletal-frame skyscrapers in New York, partially of curtain-wall construction. This was also one of the city’s tallest and largest skyscrapers upon its completion. Twenty full stories high (plus cellar, basement, and three-story tower) and clad in rusticated gray Westerly granite, gray Haverstraw Roman brick, and buff-colored terra cotta, the building was constructed with a U-shaped plan, having an exterior light court. Combining elements of the Romanesque and Renaissance Revival styles, the design, with two similar principal facades, has an overall tripartite vertical scheme, but is also arranged in six horizontal sections. A three-story arcade, open at the top story and with winged caryatids at the upper corners, surmounts the western half of the building; a three-story hipped roof tower rises through the arcade, creating a picturesque feature in the skyline of lower Manhattan.
19th century real estate speculation, on a wing and a prayer
The residential condominium 150 Nassau Street was not given a catchy name when it was converted in 2003, but to the Landmarks Preservation Commission the building is the American Tract Society Building. (That’s “tract” as in pamphlets and other publications, as opposed to “tract” as in land.) The LPC report tells the story of how the American Tract Society, which had been on this site opposite City Hall in a four-story building since 1825, decided to build a speculative office building in the 1890s.
As quoted by LPC, the Society’s annual report for 1894 justified the project on two grounds: the lot was “too valuable to be used for manufacturing”, and the “centre of the city has moved far to the north”. The goal, according to the Society’s 1896 report was to borrow against the land, erect a modern building that would generate enough to pay for Society rent elsewhere plus amortize the mortgage plus “eventually” leave the Society with a fixed income. The LPC notes that the Society had been in precarious financial condition since the Panic of 1873. The new building was (supposed to be) a way out.
At this time, this area (Printing House Square) was still home to most of the city’s newspapers, though that was beginning to change. Again, from the LPC:
By 1836, … Nassau Street was home to fourteen newspapers and "numerous bookstores, stationers, paper-warehouses, printers, [and] bookbinders," and several periodicals of a religious nature.
The shift of newspapers away from downtown began after the New York Herald moved to Herald Square in 1894 and the New York Times moved to Longacre Square in 1904, though the New York Evening Post constructed a new building in 1906-07 (Robert D. Kohn) at 20 Vesey Street (a designated New York City Landmark), and the majority of newspapers remained downtown through the 1920s.
The New York Sun was printed in the building from 1914-19, when the U-shaped light court was filled in up to the 5th floor to allow the space needed for printing.
bad luck with technology
When the building was built in 1894-95 passenger elevators were still relatively new. That technology failed here, with not one, but two, “free-fall” accidents in 1896 and 1897, one of which was fatal ("the most serious accident to a passenger elevator that has happened in New York City in many years"). Not surprisingly, the Society had difficulty attracting and keeping tenants here, so instead of moving elsewhere and living off the rental income, the Society soon had to move back to the building until 1914, when the building was surrendered to the New York Life Insurance Company and eventually lost in a foreclosure.
While the LPC does not mention this, the general national downturn known as The Panic of 1893 (caused by the collapse of a railroad speculation bubble) could not have helped. The Wiki entry for this episode includes a poster from a 1896 Broadway show The War Of Wealth based on the 1893 panic, which clearly features what is nowthe residential condo Downtown By Phillipe Starck. But I digress….
New York Life sold the building in 1919, but ended up re-taking it another foreclosure in 1936. The building was planned to have been torn down in favor of a much larger office building during the time that pace University owned the building (1967 – 1982), but that (obviously) never happened. Pace is still directly across the street to the north, and the newest Gehry towers over 150 Nassau Street from the east. There are interesting photos of 150 Nassau Street, including one with the looming Gehry, on WikiMedia.
a skyscraper built on sand
Careful readers of Manhattan Loft Guy will remember this September 3, no skyscrapers in Manhattan loft neighborhoods, but why not? post and realize why this description of the engineering challenges in building 150 Nassau Street stuck out for me:
Because the soil consisted of clay and sand, with bedrock located some one hundred feet below the surface, pneumatic caissons (used on other contemporary skyscrapers) could not be employed. … Engineering News noted that "parts of each of the two back walls, where column foundations could not be provided, are carried on [trussed] cantilevers."
In other words, this skyscraper was built here because of the nearby commercial environment, not because the bedrock made it a more suitable location; to the contrary, the sand and clay made it more difficult to build a skyscraper here.
Googling a penthouse
The building was built with that 3-story tower on top of the west side of the U. If you are wondering what it might be like to live in space like that, Curbed was there on May 25, with the tale of a Google Guy who traded in a Tribeca penthouse for this raw 6,400 sq ft space at about $6.5mm (old listing, with plans, here).
one last note (I promise)
There are names that float around modern Manhattan, ghosts of long ago. For example, I will always remember that when I lived on Broadway in Tribeca more than 20 years ago there was a painted wall advertisement for Matthew Brady’s photography studio. (I don’t remember exactly where, and I am pretty sure it is gone now, but glancing up at that sign always brought up mental images of his Abraham Lincoln portrait and Gettysburg carnage.)
Another such name is Currier & Ives. We’ve all seen enough reprints of Currier & Ives Olde New York that they all seem so trite now. (I had not realized until looking it up on Wiki just now that the firm called itself "the Grand Central Depot for Cheap and Popular Prints".) My point is that they are an almost pre-historic part of New York consciousness, but of course they were real people. The firm operated in New York from 1834 – 1907, and (according to the LPC) they took space in the old American Tract Society building (pre-1894) beginning in 1846.
© Sandy Mattingly 2010