one “painstaking deconstruction” later, 874 Broadway loft sells for 236% of 2009 price

by Sandy MattinglyPosted on Posted in loft neighborhoods flatiron — No Comments ↓

it can be very rewarding to take apart a Manhattan loft

Numbers don’t lie: the “1,674 sq ft” Manhattan loft #301 at 874 Broadway (in the lovely MacIntyre Building) that was purchased in needs-a-renovation condition for $1.1mm in October 2009 (after a very long campaign) was just sold for $2.6mm. Pictures can mislead: if all you had to go by were the recent marketing photos, you’d think the loft was still in needs-a-renovation condition. How else to explain walls that look like this?

Or a tub resting on (what??) in a bathroom of cinderblock, like this?

(Photos from the Sothebys listing on StreetEasy, obviously.) But that look was not easily achieved or (most likely) inexpensive. The old listing photos (available here) are not large enough to permit a detailed comparison, but trust me (I saw it back in that day): the loft looked nothing like this. (That broker babble gave this hint to those in the know: “awaiting your unique creative touch“.) The Before and After floor plans give the best indication of how extensive the changes were, with the kitchen moved and a second (master) bath added.

Craftsfolk to do this kind of painstaking deconstruction can’t come cheap, so let’s ballpark at $400/ft. That’s still less than $700,000, which would bring the recent seller’s buy-and-take-apart investment to less than $1.8mm, and the gross gain to something north of $800,000, or about 45% (in very gross ballpark terms, of course). For comparison, the StreetEasy same-sale Manhattan Condo Index is up only 30% from October 2009 to June 2014, so it is very likely that the recent seller significantly out-performed The Market. (It all depends on how much she spent on the deconstruction, of course, but $400/ft seems quite do-able to me.)

Conventional Wisdom about highly idiosyncratic Manhattan loft renovations takes it on the chin

It is an article of faith among people who make their money advising sellers to tone down their palette and smooth the funky elements that Buyers Prefer Neutral. (Remember what happened to The Steampunk Loft? That Chelsea loft took 20 months, five prices, two firms, and one major neutering to find a contract.) But there’s nothing neutral about loft #301 in prime Flatiron; quite the contrary: it is aggressively distressed … er … “painstakingly deconstructed”.

And The Market loved it, taking 4 weeks to get into contract $105,000 over the asking price. (Obviously, at least two buyers shared the seller’s artistic vision.) I had buyers who were the first to see it in April. They were … overwhelmed. Not surprising, as even a Manhattan loft snob like me can see that there is a very very small slice of the Manhattan buyer pool that could live in space dressed like this. It’s anyone’s guess whether this Flatiron loft or that Steampunk loft in Chelsea was more idiosyncratic in decor, but The Market response could hardly have been more different: 4 weeks to contract instead of 20 months, above ask rather than 5 price drops, $1,553/ft rather than $848/ft.

Good comp data is often hard to come by in small loft buildings like 874 Broadway, yet here the last public sale strongly supports the view that #301 got a huge market premium because of its condition. Loft #501 has the identical footprint, but was in conventionally renovated condition when it sold for $1.5mm in August 2010. (That babble boasts of “custom solar shades [, …] Miele washer/dryer[, …] Gaggeneau cooktop, subzero fridge, limestone counters, poggenpohl 80’s cabinetry[, …] dornbracht fixtures in the bathroom with kohler soaking tup and sinks[,] Moroccan cement tile in the bathroom[,] custom zebra wood cabinets[,] Massive classical built-in bookcases[,] Refinished oak floors[, and]Central A/C unit“.) The StreetEasy Index implies that loft would be worth about $1.84mm as of June (up 22.5%), although the 2010 buyer valued it at only $1.75mm when she transferred it in a private (apparently inter-family) transaction five months ago.

That’s powerful stuff: a conventionally finished loft two flights up should have been worth about $1.84mm at the same time the extravagantly deconstructed loft #301 sold for $2.6mm.

Sometimes the Conventional Wisdom just doesn’t apply … but woe to the seller who gets caught up by miscalculating when it does apply. (Looking at you, Mr. Steampunk.)

we’ve been here before

The recent babble notes that loft #301 has a “published interior“, but doesn’t say where it was published. Maybe there’s no link, or the agent didn’t go the the effort to find one, or the place(s) it has been published are not as brag-worthy as Architectural Digest. I don’t have a link, either, but I know one place this loft, as deconstructed, was published. I hit it in my May 4, 2011,874 Broadway loft featured in DWR catalogue. (DWR = Design Within Reach, of course.) It was pretty memorable in its Before condition; it is even more so now.

I love it, though I can’t be sure I’d like to live in it. But there are at least three sets of people who could, one of whom put her money into it, with the other two willing to put a lot of money into it.

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penthouse loft at 571 Hudson Street has had an exciting history, just not THAT exciting

by Sandy MattinglyPosted on Posted in Loft neighborhoods - West Village — No Comments ↓

caution: don’t take StreetEasy histories at face value

The  sale about six weeks ago of the “1,600 sq ft” Manhattan penthouse duplex loft #6B at 571 Hudson Street in the West Village at $2.95mm was a pretty exciting event for the seller, given that he had paid only $1.9mm for the loft not quite four years earlier. (We’ll get to this in a bit, but it doesn’t appear as though the loft has been much improved, if improved at all, by the recent seller.) If you rely only on the “Price History” table on StreetEasy for past sales data, you’d think the past history has been bonkers, with that recent 7-figure gain preceded by a 7-figure loss, preceded by a 7-figure gain. It ain’t necessarily so, as this StreetEasy history has one incorrect data point:

Oct 17, 2005 “previous sale recorded” $1.699mm
April 20, 2008 “Core listing sold” $2.995mm
July 1, 2010 “previous sale recorded” $1.9mm
Mar 24, 2014 “sale recorded” $2.95mm

Experienced readers of StreetEasy can guess what the problem is with that one heck of a 7-figure roller coaster. (Spoiler alert: it involves “Core”.)

That said, the real sales price history is even more interesting, if less startling, especially when you add a bit of detail from the broker babble to the mix. I am going to leave you in that teased state for a minute, and talk about the charms of this loft.

a funky One Bed Wonder on 3 (really 4) levels

If you count the entry level as two levels because the living room is sunken (you should; it sinks quite a bit), this penthouse loft has four levels: those two, plus a mezzanine level with the bedroom, walk-in closet and bath, plus the roof level with a (small … er … “cozy”) office at the top of the stairs and the “625 sq ft” private roof deck. At only “1,600 sq ft” interior, that is an awful lot of up-ing and down-ing. I had to toggle back and forth between the floor plan and the listing photos many times before I could make sense of the space, a task not helped by the fact that the bedroom photo (listing pic #2) shows a window that does not appear on the floor plan, and that the other “exposure” of the bedroom (“2 exposures and open city views”) must be due to the bedroom being open to the living room (with those “huge windows framing  ESB [Empire State Building, of course] and Abington Sq Park views”, even though those windows seem to end below the floor of the bedroom), as you will see a low glass barrier opposite the bathroom wall in that bedroom.

But wait … there’s more funk in the layout! To get a sense of how limited that “soaring ceiling” in the living room really is, note how closely the 4th listing photo is cropped. The wall of windows seems to be about three feet from the end of the “L” shaped couch, the long side of which backs against the short wall the kitchen is on, just above. Listing photo #3 shows the floor level at the entry (and into the dining area) being about even with the bottom of those “huge” windows; those windows, in turn, sit about 3 feet above the floor of the sunken living room (pic #4). Notice the extreme angle from which that dining room photo was taken: no higher than the backs of the dining chairs. Of course, taking photos from a low angle is a classic photographer’s trick for making a room seem taller than it is.

Another word about the layout. Understanding that all floor plans come with disclaimers, express and implied (“not to scale”, “for purposes of illustrations only” are two that should always be understood whether express or implied), and that measurements are often … er … fanciful (not a word you will see in babbling), look at the three pieces of the floor plan with the knowledge that the roof deck is babbled as “625 sq ft”. An architect would draw these with the skylights lining up in the same place on each level (as the stairs do), and with the south wall being the same length on each. But my point is that if the marketing materials think that roof deck is only 625 sq ft, the other levels must be the sum of that plus whatever space is taken up by the stairway plus that upper landing with the “cozy” office. Maybe that’s 12 x 4 feet of interior space on both the mezzanine and roof levels devoted to the up-ing-and-downing. Maybe what you’ve got is two boxes of no more than 750 sq ft on top of each other, with the lower box having an end with a lower floor and the upper box leading to the roof.

With windows only on the east wall and low-ish (for lofts) ceiling heights on most of the entry level and all of the mezzanine (note especially pic #2), there’s not much sense of ‘volume’ in this interior. But that’s not what sold this loft. There’s no ceiling on the roof deck, the subject of no fewer than four listing photos.

come back another day, no riffing today

It is very difficult to get a sense of the value of well-appointed interior space in this small (16-unit) coop because the last six sales have all involved outdoor space, going back to February 2010. (So I won’t try to get a credible baseline interior value per foot from which to begin to systematically assess how valuable the roof deck is in loft #6B; sorry, Fans of The Miller.) We can play with the last two sales a bit, however.

The “1,300 sq ft” loft #1A sold on February 25 for $1.59mm with a patio of about 200 sq ft (floor plan, here). That patio (no matter the size) is a very different animal than the #6B roof deck, open to the sky. And there’s no bragging about finishes, so this loft is likely not the equal of #6B’s interior finishes. Plus there’s no premium for a view way down at sidewalk level, and below. But #1A sold for only 54% of the market clearing price of #6B.

The August 2012 sale of duplex penthouse loft #6D was marred, for comping purposes, because that marketing campaign was coy silent about size. That one had two terraces (over 400 sq ft in total, with appropriate disclaimers) and little bragging about finishes apart from a “stylish renovation of the kitchen”. Certainly there is less space in #6D than in #6B (though each has but a single bedroom), but note the price 20 months ago: $1.515mm.

In other words, nothing has sold in the building in the league of #6B at $2.95mm. I’m just going to say that the roof deck added tremendous value to #6B. Now let’s get back to #6B’s fascinating history.

this West Village loft’s history is actually worse than it looks

Here is the true history, which you can confirm without leaving StreetEasy by checking the deed records with the “previous sale recorded” entries on StreetEasy (you’ll see that the October 2005 buyer was the July 2010 seller), with a bonus datum from 1994 from our listings database, which also reflects a 7-figure gain:

Feb 10, 1994 sold $465,000
Oct 17, 2005 sold $1.699mm
July 1, 2010 sold $1.9mm
Mar 24, 2014 sold $2.95mm

That is, of course, very different than if the 2005 buyer at $1.699mm sold for $2.995mm in April 2008 (just about at quarter-formerly-known-as The Peak) and then that 2008 buyer sold in 2010 at $1.9mm. Indeed, this clean sequence looks logical, with a big jump in the 11 years before 2005, a small jump to 2010, and another big jump to the present. But what if there were an intervening renovation? That could change the logic….

stop laughing, please

If you can rely upon the broker babble (see sub-head, above, you cynics), there was a dramatic change in condition of the loft, but not where you might expect it. The 2005 broker babble is still in our listings system (though not publicly available on the web) and it is much more muted than the 2008 edition, unsuccessful as it was. The babble of 2008 was both very enthusiastic and implied a then-recent change:

finally for sale after $750,000 of renovations by some of the top architects and interior designers in the city. … new dark chocolate hard-wood floors through-out. Two full baths in slate, Ann Sachs fixtures and sky lights – top, top renovations. The open kitchen features highest-end stainless steel appliances like Gaggenau, Miele and Sub-Zero. Miele W/D. Speakers in the walls in every room, including bathrooms.

From 2005, this is what I mean by “muted”:

Exposed brick and hard-wood floors through-out. Two full tiled baths. The open kitchen features a dishwasher and microwave. Your future home also includes a washer and dryer. … Walls of closets, built-ins and shoe closets. The master bathroom is built with a curved brick glass wall, and features an oversized Jacuzzi and dramatic skylights.

I have to believe that if there had been “$750,000 of renovations by some of the top architects and interior designers in the city” when the loft was sold in 2005, there’d have been some serious bragging about it. Instead, we get this “open kitchen features a dishwasher and microwave”.

Now look back at the closed sale sequence above, knowing that between 2005 and 2010 there was “$750,000 of renovations by some of the top architects and interior designers in the city”. Pretty exciting, huh? And depressing for the 2010 seller, whose $201,000 “gain” was offset by (again!) “$750,000 of renovations by some of the top architects and interior designers in the city”.

You have to feel for the guy. Just for fun, though, let’s recap the sales efforts between 2005 and 2010:

Jan 24, 2008 new to market $2.995mm
April 25 change firms $2.875mm
July 10 $2.6mm
July 22 off the market
Nov 22 change firms $2.295mm
Mar 7, 2009 $2.175mm
Mar 19 $1.995mm
May 19 off the market*
Mar 30, 2010 change agents
April 16 contract
July 1 sold $1.9mm

(* per our listings system)

Let’s review the common knowledge about The Market in that time period: Manhattan residential listings that closed in the calendar quarter that began shortly before this 2005-buyer-(eventually)-turned-2010-seller came to market saw the highest prices recorded to date; that owner picked the wrong time to go off the market (July 2008 was two months before Lehman’s bankruptcy roiled The Market); hence, the $305,000 price drop when the loft came back to market in November; it is not terribly surprising that the loft did not sell in that round, despite two price drops, as that was a very thin market, populated with relatively few buyers, all of whom can be characterized as courageous; it is a little surprising that the loft did not sell higher than it did in 2010, though not surprising that it took only 17 days to get into contract. Either the seller simply lacked patience at that point (understandable, that) or The Market was punishing the loft (for no good reason).

That 2010 buyer clearly stepped in when others would not. And got a bargain.

The overall Manhattan market (as measured by the StreetEasy Condo Index of same-sales) was up 23% from July 2010 until March 2014 (it had been 1,890 and went to 2,317). This loft? Up 54%. That’s exciting.

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the perils in following Manhattan loft deed filings, unhappy family edition

by Sandy MattinglyPosted on Posted in manhattan real estate business — No Comments ↓

not so much a diversion as a quick hit, this one of a Chelsea loft that did not “sell” as reported

Manhattan Loft Guy blog posts have been pretty infrequent of late (Note To Self …) so in the spirit of doing better I will not post a diversion that has nothing to do with lofts, as is typical for me on weekends. And in the spirit of getting out to today’s sunny crop of Manhattan loft open houses, this one will be short. It is a(nother) warning about the risk in taking deed filings at face value; in this case another easy one.

Even when I am back up to date with my Master List of Manhattan loft closings between $500,000 and $5,000,000 (sheesh … another Note To Self …) you won’t find the recent “sale” reported on StreetEasy of the “1,500 sq ft” Manhattan loft #3W at 40 West 24 Street. It is clearly not an arm’s length (market) transaction. The first hint is the price, $700,000, in a building in which there is no price this low on the StreetEasy building page’s Past Activity tab (going back to 2004). The second hint is that there is no indication the loft was publicly marketed.

The third hint is no mere hint: the “sellers” are a guy and a gal, and the “buyer” is that same guy. In other words, this was a family deal, most likely part of a larger breaking-up-the-family deal.

Without getting into too extensive a comps analysis for a loft in unknown condition that transferred at a clearly non-market value, it is interesting that this couple almost certainly did not arrive at their $700,000 deal from the assumption that the loft was worth $1.4mm. The loft directly above them just sold a year go in “mint renovation” condition for $1.275mm. A look at those listing photos and the floor plan for the “W” line at this height will tell you why $850/ft is all you get here, even in the new just-down-the-block-from-Eataly Flatiron. The floor plan shows that there are windows only on the south wall, with that doorway hinting that there is a fire escape back there. You’ll also notice that you never see a direct window shot in the listing photos. If you know the area, you know that this coop on the south side of West 24 Street just east of Sixth Avenue is just north of the lovely (and massive) Masonic Temple on 23rd Street. That’s what those south windows “look” at. In other words, being in one of the interior rooms without windows in #4W can hardly be much darker than sitting in front of the windows. Hence, $850/ft for a mint renovation loft of “1,500 sq ft”.

Long story, slightly shorter: as part of a break-up-the-firm negotiation, the guy paid the gal $700,000 to get sole title to the loft. The break-up-the-firm negotiation almost certainly involved other considerations, other assets, other liabilities. Market watchers were fortunate in this case that he didn’t buy her out for a (still non-market) number that was actually much closer to the market (say, $1.1mm). That might look like a market transaction, without being an arm’s length valuation of this loft. And we are especially fortunate that the deed record reveals the names of the “sellers” and “buyer”, making the conclusion obvious. Not all couples break-up-the-firm so publicly; some of these property dispositions hide behind fake names. This one is easy, fans of the The Market. Just keep it in mind the next time you see a deed without a public marketing campaign. The comp you think is a comp might be the result of a break-up-the-firm negotiation that has little to do with the Manhattan residential real estate market.

Put another way, as Sergeant Phil Esterhaus used to put it, let’s be careful out there.

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MercerGreene loft at 92 Greene Street sells for 4th time since 2007 (trend line is UP, if oddly disappointing)

by Sandy MattinglyPosted on Posted in loft neighborhoods soho — No Comments ↓

a series of loft owners in Soho, some happier than others

I will post some thoughts on the major firm Manhattan residential sales market for the First Quarter of 2014, but for now let’s look at the repeat sales of the “2,180 sq ft” Manhattan loft #2B at 92 Greene Street (Mercer Greene) for some time-lapse photography. (Not-much-of-a-spoiler alert about #2B and The Market: values are going up, dramatically, especially if you take the long view.) Yes, this loft just sold up from its prior sale way back in 2010, but the pattern of sales is long, and interesting:

May 31, 2007 sponsor sale $3,492,597
July 17, 2009 $3.5mm
Mar 30, 2010 $4.25mm
Mar 21, 2014 $4.85mm

Happiest, so far, is the second set of owners. They had the biggest gain (by dollars or percentage) after holding for the shortest time. They also showed the most fortitude, by buying into a market that was convincingly in a thaw only in retrospect. See what that got them!

The most relieved might be the first owner, despite the fact that he sold for $7,403 (yes, that’s 4-figures, not a typo) more than he paid and had to pay a sales fee and transfer taxes in the mid-$200,000s. Evidently, he had to sell, coming out to market in March 2009 (brrr … chill … Nuclear Winter!) at $3.595mm, a price that would not even have gotten him even on a net basis.

not as happy as they wanted to be, alas

The folks who just sold were the ones who bought from that gutsy (and happy!) guy four years ago. It is hard to feel badly for folks who sold into a market that was $600,000 higher than the market they bought into, but … $600,000 doesn’t buy as much happiness as it used to. And they certainly wanted to be happier:

June 13, 2013 new to market $5.6mm
Aug 22 $5.295mm
Oct 10 $5.1mm
Feb 18, 2014 contract
Mar 21 sold $4.85mm

Even after one price drop they were looking for a seven figure appreciation, or 25% for their four years of ownership. What they got was that $600,000, or 14%. The only people who would not be happy with that would be folks who expected more because the overall Manhattan residential real estate sales market enjoyed much better apprecaition than that gain over those four years. Measured by the StreetEasy Manhattan Condo Index, the overall market index value in March 2010 (when they bought) was 1,840 and 2,331 (gulp!) in February 2014 (the last month available). That’s an increase of 26.7% for the overall market (as measured by same-condo resales).

Now go back and look at their asking prices last Summer, remembering that a deal at the first price drop would have been 24.6% over their purchase price. No wonder they must have been disappointed at (only) $600,000 and 14%.

Of course it remains to be seen how the new owners do financially, but let’s see where all these folks have been (are) living.

a classic Long-and-Narrow loft shape with a bonus level

Loft #2B is billed as a “split level triplex”, but the basic configuration (and most of the interior space) looks like a classic Long-and-Narrow loft with the public space up front, the kitchen in the middle, plumbing on both long walls, and a single master suite in the rear, with about two-thirds of the loft enjoying 15 foot ceilings. The wrinkle in this floor plan is that this second floor space takes advantage of additional volume at the rear of the building by going up some stairs for the master suite and down some stairs to a lower level. This is not merely a matter of taking advantage of 15 foot ceilings to add a mezzanine level (as you sometimes see, though with only 15 feet your head might involuntarily duck at the two half-height levels in a mezzanined loft), as the lower level is definitely down from the main level. Hence, the babbling as a “split level triplex”.

That lower level is the bonus, but there’s more to it than two bedrooms across that back wall of the loft: there’s a “500+sf exquisitely planted terrace with flowering trees and boxwoods with custom mahogony trellis” down there, as well. That is one heck of a bonus, even one so low (just below the second floor of the building) and facing mid-block and any curious neighbors. It is hard to say what the original configuration of this loft was when marketed by the sponsor in 2006, but the last three owners (at least) made the prudent judgment that the outdoor space is best enjoyed with access from a public room rather than from a third bedroom. Hence, the unusual “second family / living room” in the broker babble:

The lower level, currently configured with one bedroom and a second family/living room and a separate home office, can easily be converted back into a two bedroom layout.

My guess is that the sponsor realized the same thing, and probably sold it as a convertible-3 bedroom loft with two living / family spaces on two levels, but I don’t see a floor plan from the as-sold loft in original shape. The finishes, however, seem to be the original (high quality) of this (then) state of the art luxury condo development in prime Soho.

comping is ______

Both the outdoor space and the split triplex aspect of loft #2B complicate a search for comps for this loft, as does the fact that it is ideal as a two-bedroom rather than a three. The last two sales in the building were almost two years ago and are frustrating for being difficult to smoothly reconcile with each other, let alone as the basis for a time-adjusted and Miller-riffing comps analysis for the recent #2B sale.

Both the “1,683 sq ft” loft #3A and the “1,552 sq ft” loft #3B have two bedrooms, 2 baths and both were marketed as though they were still in the same deluxe condition as delivered by the sponsor; yet they sold within 3 weeks of each other in May and June 2012 at divergent prices. #3A at $3.55mm came to $2,109/ft and #3B at $3.104mm came to an even $2,000/ft. On the one hand, that’s barely over a 5% spread; but on the other hand, these lofts are in the same building, with the same finishes, and essentially the same utility. (They also went into contract within 3 weeks of each other, and both were sold by the same agent[!].) Absent learning something more about these lofts or this building before I get to the bottom of this post, I have to chalk the 5% spread between these two sales up to ‘market noise’, and hope not to cause too much weeping on Team Efficient Market. (There’s a wonderful opportunity for that, coming.)

Let’s blend them to get a low-floor interior value for this building of $2,057/ft, circa June 2012. A simple time adjustment using the StreetEasy Index (then 1,995, blending May and June 2012) suggests that the overall Manhattan residential real estate market is up 16.8% since then, so that these lofts, if sold by February 2014, would have sold for a blended $2,403/ft, more or less. That implies that the interior space for loft #2B this year would have been worth … (wait for it) … (look at the clearing price while waiting for it) … about $5.25mm before considering what additional value the spectacular terrace adds.

Let’s tie that up: loft #2B just sold for about $400,000 less than you’d expect based on the 2012 sales of #3B and #3A even before considering that the terrace has some (significant) value.

let’s riff with The Miller about outdoor spaces in Manhattan lofts

You know I love to work off of my blog response to The Miller’s seminal work on valuation of outdoor space (see my March 27 post, just above). Taking this terrace down to the lower end of the typical range (25% of the value of interior space) for argument’s sake (even though a good argument can be made that that is too low), the actual valuation assigned by The Market to loft #2B was an adjusted $2,104/ft. That, of course, is barely 2% more than the blended #3B/#3A value in 2012, and pennies $2/ft lower than the #3A sale in June 2012 if considered as the only comp.

Did I mention that the #2B sellers must have been unhappy selling for $4.85mm even though that was $600,000 more than they paid?

Did I mention that comping is hard?

… in which heads are scratched (and Manhattan Loft Guy’s head may explode) …

I can make an argument that the interior space of the third floor lofts should be worth more than that of loft #2B because multi-level lofts are not as functional (for most buyers) as simplex lofts, but that argument lacks a certain conviction given that the 3rd floor ceiling height is (only) 12 feet while most of the main space in loft #2B reaches 15 feet high. I can make an argument that the configuration of loft #2B is less than ideal, what with the multi-levels and lower ceiling height bedrooms and the logic behind turning space that could be a(n oh so valuable) third bedroom into a second family/living room to get public access to the terrace, but that argument lacks a data set to be able to scale it, even though I believe it to be valid. (The second family/living room is little better than a hallway to the terrace, and the terrace is a long walk from the kitchen.)

I can’t make an argument that these #2B deficits combine to wipe out the observed market improvement from June 2012 to present. (Hence, the scratching and the risk of combustion.)

I am not going to make an argument that these recents sellers overpaid as buyers in 2010 because I don’t have the data (the only sale in the building going back 6 months or forward 13 months from the #2B purchase was a hard-to-comp penthouse). But that, if true, would (help) explain (some of) the problem. Even the possibility of that as a contributing factor to my math problem would probably make these 2010-buyers-turned-2014-sellers even more unhappy.

Please don’t tell them.

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New York Times revisits valuation of outdoor space, oddly

by Sandy MattinglyPosted on Posted in loft features outdoor space — No Comments ↓

nice to see numbers, but the article is a mess

Did you see the big piece in Sunday’s New York Times real estate section about valuing balconies, terraces and other outdoor space in Manhattan lofts and apartments? On the one hand, Terrace for Sale, Includes Condo is a refreshingly data driven article, prominently featuring a Warburg agent who keeps a data base of “several thousand” (!) Manhattan sales with outdoor space. On the other hand, the article is a maddeningly meandering mess. On a third, if whimsical, hand, it is shocking to see a Manhattan valuation article in a major organ of the Real Estate Industrial Complex, Manhattan Media Division, that does not include the words “Jonathan Miller”. (Perhaps he forgot to pay his 2014 dues??)

This is going to take a while, as there is some classic Manhattan Loft Guy meandering ahead. So take it slow.

the good news: The Rubric lives

Reporter Julie Satow is in good company in referring to “the industry rule of thumb, which places outdoor space at 20 percent to 50 percent of the price of the interior square footage”, though there’s no citation for this standard. As long-time readers of Manhattan Loft Guy will know, I frequently cite The (missing) Miller in support of a rubric setting 25% to 50% as a baseline for considering the value of outdoor space, with my May 6, 2010, riffing with The Miller on the value of Manhattan terraces, decks + balconies, being probably my most self-cited post. (If you are interested in this topic and have not read that post or the underlying Matrix blog post by The Miller, go there now; I will wait.) (Waiting ….)

I just re-read it myself and I am pleased that my post holds up so well after almost 4 years. Seriously, it is worth it if you are at all interested in the valuation of outdoor spaces in Manhattan.

After Satow cites the Industry Rule of Thumb of 20% to 50%, she then gets a different range from her data source at Warburg:

“There are so many variables, most brokers don’t know how to price outdoor space,” [the Warburg agent] said. “They go into an apartment and say it feels like $5 million, but they don’t have any data to back that up.”

According to her research, up until last year, these spaces sold for roughly one-quarter to one-third the value of the interior space. An apartment priced at $1,000 a square foot, for example, would have a terrace valued at $250 to $330 a square foot. She has found, however, that among the new luxury condominiums going up across Manhattan at a quick clip, the price for outside space can rival the price of the interior space

That claimed historical range of 25% to 33% is remarkably narrow, especially since (as the agent said), “[t]here are so many variables.” I wonder if that agent is the source for Satow’s litany of different kinds of outdoor space, here:

But not all outdoor space is equal. Like so much in this city, there is a hierarchy to heed. On the lowest rung of the ladder is the balcony, typically a cantilevered concrete slab that hangs off the side of a building like a jutting lip; it is used more for bike storage than sunbathing. On the highest is the terrace, usually tucked in a building setback so it opens to the sky, and large enough to host a summer barbecue.

Among terraces, the most sought after are directly accessible from the living room and have both helicopter views and privacy from the peering eyes of neighbors. Shape is also an issue. Wraparound types that stretch across more than one side of a building and offer multiple exposures are considered prime, followed by the square shapes that perfectly suit a dining table. And finally, there are the rectangular slivers that can barely hold potted peonies.

Then there are other kinds of outdoor space: the rooftop garden is loved by some, although it is considered a notch below the terrace because of the inconvenience of having to walk up steps, while maisonettes offer ground-floor gardens that can be large but are often too dark, shadowed by the tall buildings that surround them.

Thus, we have these variables: size, accessibility, views, privacy, shape, light. This list is uncontroversial, though The Miller was a bit more precise in, for example, referring to relative size of outdoor space to indoor space, with a terrace larger than half the size of the interior unit requiring a downward adjustment. Simply reciting a (non-exhautive) list of valuation considerations such as this should make the point that there is no formula that can generally be applied.

I can’t do better than quoting the master, again (his bold):

Disclaimer: No comments by an appraiser would be complete without a disclaimer. It is important to note that these are only rules of thumb to guide you – the value of a terrace is not formula driven – these relationships are developed from market data and can vary significantly depending on the combination of amenities and time. If you are unable to grasp this, close your eyes very tightly, think about a cool ocean breeze on a warm breeze sandy beach, while holding a large set of perfect comps, until memories of this post fade completely away.

Again, that claimed historical range of 25% to 33% is remarkably narrow, if it starts with those crappy outdoor bike storage spaces balconies at 25% and only go to 33% for a setback terrace large enough to host a summer barbecue. But if she has “thousands” of data points I won’t argue with her conclusions based on her data. I will argue from my own data points for Manhattan loft sales below, but let’s get back to the meandering New York Times piece.

and the point is …?

This bit about changing market conditions seems to be the main point of the Satow piece:

The demand for outdoor space has grown so strong that in some instances, prices have exceeded the industry rule of thumb, which places outdoor space at 20 percent to 50 percent of the price of the interior square footage. Some terraces are trading for as much per square foot as the interior space, or even more.

That’s where the wheels come off the article.

First, Satow then quotes that Warburg agent with her data-base derived historical range of 25% to 33%, with the (very) limited observation that in the current market

among the new luxury condominiums going up across Manhattan at a quick clip, the price for outside space can rival the price of the interior space.

The data-driven agent went on to make a general point about a significant part of the market, a point that I find hard to believe (at least as far as Manhattan lofts are concerned):

For co-ops, she found that terraces remain priced at one-quarter to one-third the value of the interior space.

Let’s review the world according to Satow: (a) the industry rule of thumb is that outdoor space is valued from 20% to 50% of the interior space; (b) but one agent who has a data-base thinks the real range has been 20% to 33%; (c) among a narrow subset of the market that gets a great deal of media attention, in “new luxury condominiums” outdoor price-per-foot values “can rival” indoor values; yet, (d) while among coops, terraces still fit the observed narrow historical range (20% to 33%). Additional support for these observations is anecdotal, if weak:

(e) “the average price of a luxury condominium [in downtown Manhattan] with a terrace is $8.3 million; that compares with just $6 million for those without terraces, according to Vanderbilt Appraisal”, a data point offered without consideration of the relative value of interior or exterior on a price per foot basis;

(f) “at Walker Tower, the Chelsea conversion where prices have broken several downtown records, a unit that has a terrace is selling for a premium of more than 40 percent over comparable apartments without outdoor space, according to Vanderbilt”, another data point offered without consideration of the relative value of interior or exterior on a price per foot basis; and

(g) “[a]t the recently completed 200 East 79th Street, [the Warburg agent] estimated the value of a nearly 700-square-foot terrace at more than 100 percent of the value of the interior of its high-floor apartment”, which, if an accurate estimate, is a data point based on relative values, but also a single data point.

Satow lets the Warburg agent tell a story, apparently thinking that the story supports her (only)-new-condos-break-The-Rubric theory. The story concerns a foreign guy who won a bidding war by bidding beyond the comps. Although the bidding concerned a condo with a terrace, there is no way to tell from the article whether the winner overpaid for the terrace, or overpaid for the condo, let alone what the relative values were for the interior and exterior spaces. According to the Warburg agent, that non-U.S. buyer overbid as a global-allocation-of-resources strategy (“for him, to pay a little bit more in New York was actually a good bet, compared to what he would be paying in London or Hong Kong”). That’s a quote appropriate to a different article, the boilerplate rich-foreigners-find-Manhattan-cheap article, rather than a quote that supports newly high relative values for terraces.

In other words, none of these reasons are particularly compelling pieces of direct evidence to support the conclusion that the new luxury condos with terraces represent a new phenomenon in the Manhattan market as far as relative values, indoors and out.

getting stuck in a loop of circular logic

In analyzing the rich foreign guy in that story (the guy who is “worth over $100 million”), the Warburg agent makes an interesting observation, that I just don’t see as adding much value to the article:

“a terrace buyer is an uncompromising buyer,” willing to pay more for what he or she wants.

From the limited facts as given, that guy was uncompromising not because he was a terrace buyer but because he was a rich foreign national who wanted to park wealth in Manhattan real estate, and was rich enough that he would overbid the comps to do so without financial remorse.

If what the agent means is something like “a buyer who has to have a terrace won’t compromise by buying something without a terrace”, that doesn’t seem to add much insight, even though it is likely to be true in almost all cases. It comes down to wealth: “a buyer who has to have a terrace won’t compromise by buying something without a terrace, and will overpay for the terrace if she has the need and the resources to do so“. Again, this seems both a true and an unhelpful way to describe a small class of buyers.

I heartily agree, by the way, that some people will overpay for outdoor space, in the sense that they will pay (and have paid) well beyond the rule of thumb valuations. I said as much in my May 6, 2010 post:

I suspect The Miller would find it prudent to consider how many choices a buyer has that include outdoor space. (Makes sense to me.) In the case of this deck, that seems to me the most likely driver for a premium value: someone who loves lofts has relatively few choices that include exclusive rooftop space. That buyer might be willing to ‘overpay’ to get that amenity, in the same way that people who love views will overpay.

Indeed, that post referenced a loft-with-roofdeck sale that I had then recently hit (in my May 1, 2010, terrace sells for about $1mm at 110 West 25 Street), in which the rooftop space was valued at about 70% of the interior value, despite being (in Miller terms) proportionately too big to even be considered for a uniform outdoor space value.

That loft-with-roofdeck was a condo, but hardly one of the new luxury developments that Satow thinks is breaking new ground. 110 West 25 Street is a lovely 2002 conversion, but with no amenities.

To take one more example from the very recent Manhattan Loft Guy archives, in my March 25, happy Renwick penthouse loft at 808 Broadway sells at $1,643/ft, I hit a coop with a terrace that was so lovely that it seemed to have just sold

essentially at par with the interior space. (If 95%, given all the ballparking here, is “essentially at par”.)

There’s another coop example in my June 1, 2012, loft on top of 303 Mercer Street sold with a very expensive roof deck, in which that roof deck comped out at 138% of the value of the interior. (My Miller-referencing sub-heading in that post was “breaking the Riff-o-meter”.) I was pretty astounded by that result, and struggled to rationalize it. (#FAIL) My conclusion should sound familiar by now:

To be plain: there is no way to rationally value the outdoor space of loft #A608 in a way that is consistent with past sales of lofts in the building without outdoor space, or with the only loft in the building with outdoor space that has sold in similar condition recently. No. Way. At. All.

You could say that the #A608 is an outlier. Or you could say that the buyers overpaid. And you could wonder how a bank appraisal worked for this sale.

are Manhattan lofts so different?

I am sure I could find other examples of outdoor space in lofts that comps out well above The Rubric. And I am sure that this is neither a new phenomenon nor one limited to newly developed uber-loft condos. Taking the Warburg agent at her word about her 4-figure data-base, I have to suspect that she’s got relatively few penthouse lofts in her set, and that (if she looked only at that niche) penthouse lofts are more likely to be outliers than your basic coop “apartment” apartment with outdoor space.

Penthouse lofts are still relatively scarce, which has to drive value for buyers who (a) love lofts, (b) won’t compromise on outdoor space, and (c) are well-heeled. But now I am not only repeating myself, but settling into a tautology loop. So let’s break out of that by wondering again about some odd stuffing in the Satow article.

meandering into some odd diversions

It looks to me as though reporter Satow got some interesting fact nuggets that don’t really fit the apparent point of the article (“demand for outdoor space has grown so strong that in some instances, prices have exceeded the industry rule of thumb …”) but were too juicy to leave out. So they got dumped at the end.

There’s that diversion about the lack of equity among owners at 215 Sullivan Street, where (some) “owners don’t even have to care for their outdoor space”. That story says nothing about the relative value of indoor and outdoor space, though it raised an interesting question for me. If 60% of the unit owners there have terraces or gardens that the condo maintains, do those unit owners have higher common charges to reflect the extra services they get?

And then there’s that diversion about scary terraces that are too high in the sky (“there is also the question of whether you would really want to sit on a terrace 50 stories above the pavement”), with a Rupert Murdoch name check. I can easily see how a terrace can be too high to be as functional as one closer to the ground (what’s the point of hanging out in a windstorm?), but Satow was unwilling to consider how that plays into values.

If the point of the Murdoch penthouse story is that the super-rich with fragile egos will overpay for an amenity so that other super-rich people will be impressed, well okay … but that would be still another story. One not directly related to valuing indoor space and outdoor space, and whether there is, in fact, a trend of outdoor space becoming relatively more valuable.

Great Jones Street loft shatters (old) (near) Peak performance in cute Noho corner

by Sandy MattinglyPosted on Posted in loft neighborhoods noho — No Comments ↓

remember The Peak? overall Manhattan market data re-sets into new heights

The “1,250 sq ft” Manhattan loft #2 at 3 Great Jones Street that sold two weeks ago for $1.63mm had been bought by the recent seller on July 2007 for $1.35mm. That’s a gain of 21%, for those who have trouble finding the calculator utility on their smartphones. That earlier sale was not quite at (what I might have to stop calling) The Peak, as I have used The Miller’s quarterly data pointing to the First Quarter of 2008 as the quarter with the highest sales prices recorded in the overall Manhattan residential real estate market. Using the monthly StreetEasy Manhattan Condo Index, July 2007 was still not The Peak, but it was close: rounding to three digits as StreetEasy does, the highest monthly Index values were the 2.19k in both October 2007 and March 2008. July 2007 was close, and not just in time, as the Index value was 2.13k, within 3% of the high point(s) of the Index.

The monthly Index hit that 2.19k again this past November, then hit new highs in both December (2.24k) and January (2.27k), with the February data not yet available. It should go without saying that it remains to be seen whether these levels will be sustained, or become a new Peak, or be data points in a further increasing market, but let’s not be subtle about that uncertainty. For now … wow. StreetEasy shows the last two months’ worth of data beating The (old) Peak by 2.3% and 3.6%.

With that context, look again at the market response to this rather modestly sized, modestly babbled, and second floor loft at the delightful corner of Shinbone Alley: to market at what could be seen as an aggressive $1.625mm on November 20 (remember: $1.35mm on July 30, 2007), in contract by December 13, and closed on March 12 at a tiny premium to ask, $1.63mm. Again: that’s a gain of 21% for the seller, over a period that the overall Manhattan market (as measured by StreetEasy) was up less than 7%. I have a theory rationalization for that result, but let’s first look at this second floor over-performer.

modesty abounds in this minimalist Noho loft

The modifiers in the broker babbling are very limited: the loft is “sunblasted”, the windows are “custom”, storage space is “abundant”, the master bath is “large”(!), and the aesthetic is “minimalist”. That’s it. No further boasting. I suspect the agent could have justifiably boasted about the kitchen, at least, if not the (large, but unpictured) master (only!) bath. The pictures are certainly lovely, with little that is “classic” about the loft, but a strong minimalist aesthetic offering strong and clean lines everywhere. And an angled wall that is more evident in the floor plan than in the photos. (I wonder about the gratuitous rise of the dining area, but the place looks terrific.) There is no evidence of architectural details and the dropped ceiling with recessed lighting is an anti-classical element.

You can’t tell from the limited StreetEasy data, but the loft was in exactly the same condition in July 2007, when the recent seller bought it for the now-evident bargain price of $1.35mm.

There’s an alternative floor plan provided, with a simple 2-bedroom set-up replacing the dining area and eliminating that angled wall, but this loft is clearly optimized for an individual or couple, as a large (and largely open) 1-bedroom, with storage that is abundant for people sleeping together but perhaps not for more folks sleeping in a second bedroom. Minimalism is hard to maintain with kids around.

There appear to be two words missing from the broker babble: walk-up. Our listing system says this building has no elevator, which is consistent with the shape of the cut-way in the floor plan being a public stairway rather than an elevator vestibule.

celebrating the diversity of Manhattan lofts since 2006

The best same-building comp for the recent sale of the second floor is that 2007 sale of the same loft, and we’ve already seen that that is of limited utility, as just making a time adjustment based on overall market stats yields a too-low current value. But if you clicked around on the Past Activity tab for this building on StreetEasy you found the surviving listing for an unsuccessful attempt to sell the 4th floor loft in 2009 for $1.295mm. Once again, here’s what I love about Manhattan lofts: two lofts in the same building, with identical footprints and plumbing access can have very different looks.

In this case, the 4th floor crams 2 bedrooms plus an office into space the 2nd floor allocates to an open loft plus a single bedroom. The picture of the “eat-in country kitchen” is certainly radically different from the smaller (minimalist) kitchen on the 2nd floor, with what might be tin ceilings. (Certainly, that ceiling is highly textured.) Note those kitchen windows. We have the 4th floor floor plan in our listing system, which shows that the kitchen and bathroom take up the entire back wall of the loft and benefits from windows on that back wall. The kitchen is listed as 16 by 15 feet, ample for eating in.

You buy a Manhattan loft, you can do pretty much anything you want to it. In the case of the 4th floor, that included lots of utility and little volume, with a floor plan oriented to spending a lot of time in that large kitchen. You’d not spend much time in the bedrooms, as they are both capable of inducing claustrophobia, as is the little office. Even at this relatively small scale in this building, there is a great variety in what lofts look like, and how their spaces are organized as well as decorated.

For someone interested in a loft that looks like the 2nd floor, the 4th floor would present as a gut job; for someone who prefers the 4th floor, the 2nd floor is likely to feel cold. Different strokes, folks!

if you forced me to guess …

I hinted above at having a rationalization for the market performance of the second floor loft, from 2007  at $1.35mm to 2014 at $1.65mm. Fact is, I can’t ‘explain’ this sequence, so I would alibi that The Market does what The Market does. I.e., it is not rational or efficient at the granular level.

But if you told me that I had to come up with some hypothesis, insisting that there is more rationality to The Market than I give it credit for, I would say … Noho. Great Jones Street is not Bond Street (the “it” street in Manhattan for a few years, and one that has become a brand unto itself), but it may be getting a ‘halo’ effect from being only a block north of Bond. (Let’s not call it NoBo, as Great Jones Street is quite sufficient.) There’s probably not enough sales data to test this theory guess, but that’s the only factor that might support this loft on this block outperforming The Market by such a degree.

Unless it’s just miscellaneous market madness, of course….

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happy Renwick penthouse loft at 808 Broadway sells at $1,643/ft

by Sandy MattinglyPosted on Posted in loft neighborhoods east villag — No Comments ↓

the open city makes a big difference in a loft penthouse

The most important words on the floor plan for the “1,400 sq ft” (true) penthouse loft #PHB at 808 Broadway (The Renwick) are “open city views”, which help make this a truly happy penthouse loft, in pointed contrast to the sad sack of a “penthouse” loft at The Chelsea Mercantile that I trashed in my March 21, saddest Chelsea Mercantile “penthouse” loft sells under $1,900/ft. Like “#PHS” at 252 Seventh Avenue, #PHB at The Renwick has a single exposure, but the “open city views” over the “475 sq ft” (planted, irrigated) terrace here bring light and, yes, a view, into each room. Quibblers will note that the sad penthouse at the Chelsea Mercantile condo sold for a higher price per foot than this one at The Renwick, but c’mon people … The Merc is a full service condo, while The Renwick is a lovely little coop with a doorman. (Indeed, the maintenance for #PHB is $3,123/mo while the total taxes and common charges for the half-again-as-large #PHS are only $2,937/mo.) Back to those views …

The single exposure is east, across Fourth Avenue, which conveniently bends away to the south and east, opening up a bit more of an oblique view. That’s the much taller 111 Fourth Avenue directly across the avenue, but the low Post Office is at the northeast corner of Fourth and 11th Street, with similarly sized buildings further south. (On this side of Fourth Avenue, the building just to the south is not more than 10 feet taller.) So if you just angle your chair a bit on the terrace, voila! Light in abundance, as in listing photo #3. (Just for fun, compare that image to listing photo #5 for #PHS at The Merc and you will see why one is a happy penthouse and one isn’t.)

that’s an expensive terrace on this loft

It is difficult in this building to get a comp to establish a value for the interior space, as there are few recent transactions and none that have comparable light without having outdoor space. The best we can do is #3J that sold last July and another “J” loft that hasn’t sold yet. The “1,000 sq ft” loft #3J has little light and a small balcony that I am happy to ignore for comping purposes. It sold for $1,080/ft in a market that was just a tad lower than the current market. (If 5%,per the StreetEasy Manhattan Condo Index, is “just a tad”.) Adjust 5% for that timing, and a no-light interior loft in the building in decent condition yields $1,134/ft for the interior; let’s add a generous 10% for the difference in light between #3J and #PHB, yielding an interior ballpark benchmark of $1,242/ft.

With this generous ballpark, the “1,400 sq ft” interior of the penthouse loft should have been valued by The Market at about $1.74mm, leaving about $560,000 as the value of the terrace. Fans of The Miller (and of my Miller-riffing post about valuing outdoor space) are already impressed, as the math about the “475 sq ft” terrace worth $560,000 is … $1,179/ft, which is essentially at par with the interior space. (If 95%, given all the ballparking here, is “essentially at par”.) Wowzers.

I mentioned another “J” loft above, one that is useful as a comp ceiling. This one, said to be “1,100 sq ft” with a larger bit of outdoor space and no better light than loft #3J has not sold, despite having been offered below $1,000/ft (even ignoring the outdoor space). And this “sun drenched” smaller loft (said to be “950 sq ft”) has also not hit a market clearing value, despite the light and despite being offered at $1,157/ft. Again, my notional interior value of the interior space (above) of $1,242/ft seems, if anything, somewhat generous. And the lower the value allocated to the #PHB interior, the more allocated to the terrace. Double wowzers.

Comping is, of course, hard. But by any reasonable data-based approach, the sunny and open penthouse terrace on top of 808 Broadway is worth the value of the interior of the penthouse, or more ….

into the WayBack Machine with Mr. Peabody, to find a very small round number

Our data-base has two ancient clearing prices not available elsewhere. This penthouse loft sold in January 2001 for $975,000.
 It must have been in well renovated condition at that point, as that seller at $975,000 paid only $230,000 just over four years earlier (November 1996). I will let you do the math to show the appreciation from 2001, while I stretch languidly for this bit of numerical low hanging fruit: since the loft was purchased almost 18 years ago, it has appreciated exactly by a factor of 10. (Putting aside renovation costs, but still.)

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no lofts diversion about blue skies + how the internet works (+ doesn’t)

by Sandy MattinglyPosted on Posted in internet and blogosphere — No Comments ↓

context is hard to convey in a quick hit

I love the Bad Astronomy guy at Slate, Phil Plait. Like the recently departed from Slate Matthew Yglesias, Plait has a gift for asking simple questions that (eventually) have simple answers, if not the answers we expect. His recent post, Meme, Myself, and Eyes, considers the way the intertubes present and distort information, while addressing that age-old question, why is the sky blue, and how can I explain that to a 5-year old? Along the way, he uses his own writing as an example of how anyone’s writing can be quoted out of context on the internet, with the (un)lucky ones becoming viral memes of misinterpretation.

Plait’s jumping off point is the recent repeat of an internet meme based on a quote from a book he wrote 15 years ago. He devoted a chapter to the first topic I mentioned (why is the sky blue?), which he closed with a discussion of the second, how can I explain that to a 5-year old? I’ve not bothered to check the sources, but I assume that Plait’s interpretation is correct, that people quote part of his response to that second topic to hold him up to ridicule. The (ridiculous) quote is

“If a little kid ever asks you why the sky is blue, you look him or her right in the eye and say, ‘It’s because of quantum effects involving Rayleigh scattering combined with a lack of violet photon receptors in our retinae.’”

The part not mentioned by people ridiculing Plait immediately follows, and includes: “In reality, explain to them that…”. In other words, the block quote was clearly not intended by Plait to be the best answer to give to a 5-year old.

Plait wrote that book before The Twitter was a thing, but the ease with which social media (especially) and The Internet (generally) reduce things to less than their essence is a remarkable thing. Indeed, a worrisome thing. Everyone that posted that block quote for the purpose of mocking the author was being both 100% accurate (in the quote) and 100% wrong (in its meaning). To take a more fraught example, you didn’t build that.

The urge to skim stuff to post cute on The Facebook or to break something complex into bites of less than 140 characters is a truism of modern social media life. ‘Corrections’ or ‘amplifications’ by the original purveyors (misinterpreters) never get the currency of the original link or post or RT, especially if the original (inaccurate) item fits what people (inaccurately) ‘know’ to be true.

Let’s be careful out there, boys and girls. The intertubes are dangerous. Don’t be lazy and post or RT a provocative piece without checking the source. Sometimes the scientist is not really suggesting you tell a 5-year old about Rayleigh scattering but concludes a  book chapter devoted to the question by offering a very understandable analogy about leaves being blown about before hitting the ground. Ignorance is just that; don’t fall into it.

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saddest Chelsea Mercantile “penthouse” loft sells under $1,900/ft

by Sandy MattinglyPosted on Posted in loft neighborhoods chelsea — No Comments ↓

nothing personal, but a great Chelsea loft condo should have great penthouses

There is nothing wrong with the “2,002 sq ft” Manhattan loft #PHS at 252 Seventh Avenue that a name change wouldn’t fix. Not a name change of the condo, as the Chelsea Mercantile is the icon that put the Up into this micr-nabe as an up-and-coming loft neighborjood back in the day, but a name change of the condo unit to something like  “#19S”. As it is, calling this thing “Penthouse S” just leads to seriously unmet expectations of greatness. After all, The Merc is famous for its high floor views and a “penthouse” promises something extra.

If this loft were named “#19S”, one would more easily appreciate its charms: 10 ft ceilings, “enormous” windows, space at a scale that easily accommodates 3 bedrooms and an “extra” room, all in a high amenity condo with relatively low monthlies. As “#19S” it would be easy to appreciate (I almost said “easy to view” there) the skylights and terrace (“43′ terrace ideal for entertaining or serene and peaceful indoor/outdoor living”) as bonus items. But billed as a penthouse, one reasonably expects open views, especially from a terrace ideal for entertaining, etc.

The hint of dismay and disappointment comes with that first listing photo, which is what you’d see on entry. There seems to be a pastoral mural painted just outside the windows of the great room that, on closer inspection, is revealed as the wall that delineates the width of the terrace, festooned with (fake?) greenery to cover the masonry that must be underneath. That greenery is topped by the wall of the adjoining building to the north, making this terrace more like a canyon than some second floor terraces I have seen. That 6th listing photo reveals the limited charms of that terrace: barely wide enough for the chairs at the dining table to be pushed back comfortably, with the windows of at least two floors of the adjoining building looking directly down at the terrace, and a sliver of open sky to the west.

Putting aside the (major) limitation that the windows of the great room and of the two secondary bedrooms all face that wall of (fake) greenery a bare ten feet away, the floor plan reveals that there is basically that one north exposure, with the bonus ‘study’ facing the open sky west. (The 4th photo shows that the sellers used that ‘study’ as the bedroom in the master suite, which otherwise lacks a window.) The floor plan reveals other limitations oddities, principally the bedroom dimensions. In a loft of “2,002 sq ft”, the third bedroom is well short of the 8 foot width required of a legal bedroom, at a quoted 6’8″; the master suite has that odd arrangement, and is less than ten feet wide. (The master bath is the only spacious element of the master suite.)

the runt of the litter, for sure

The “2,201 sq ft” loft #PHK is not a real penthouse either (no outdoor space), but it sold in January as a deluxe property: $5mm, or $2,272/ft. Granted, that boasted a complete renovation and open city views (including a peak at the river), but that’s a huge price per foot premium over #PHS (ballpark the terrace as worth only 25% of the interior to get an adjusted $1,784/ft for #PHS). Other recent high floor sales at The Merc include even higher values: the efficient 2-bedroom-2-bath “1,327 sq ft” loft #18C sold for $2,336/ft on October 10, helped considerably by wonderful finishes and views to the Statue of Liberty (#17C got only $2,106/ft on September 18, likely discounted for being sold with a tenant in place); #17D got $2,233/ft on September 9, again helped by views that included the Empire State Building north and Statue of Liberty south. (I hit that “C” pair of sales in my November 4, 2013, why not? Chelsea Mercantile loft with forever views sells for $2,336/ft.)

You have to go back a year to find a ‘true’ penthouse sale in the building (one with outdoor space). The duplexed “2,270 sq ft” Manhattan loft #PHQ sold for $4.5mm on March 7, 2013. That one had a wrap terrace of small but undetermined size, so it is hard to put its apples against the apples of #PHS. Looking at unadjusted values, this year-old duplex loft sale at $1,982/ft beat #PHS at $1,878/ft rather handily. There’s not much to see in the “open western views” of #PHQ (no mention of the river, for example, and no iconic buildings), but that still beat the ‘view’ of a nearby wall of fake greenery in #PHS. By a lot. With good reason.

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wheel makes one more turn for Manhattan Loft Guy, the blog

by Sandy MattinglyPosted on Posted in internet and blogosphere — No Comments ↓

we just did this last year at this time …

Yes, friends, it’s cake and balloon time (virtual cake and virtual balloon??) as another blog-aversary rolls around. EIGHT years ago today a real estate guy who had by then been living in Manhattan lofts for 25 years first pounded the keyboard in a (then new-for-real-estate-internet-thing-y) called a Web Log, or “blog”, with a new and virtual persona … Manhattan Loft Guy. It’s been eight years of mostly steady blogging since then, with one long post-kidney unauthorized sabbatical in late 2009 and a slow start to 2014, until the counter is at something greater than 2,200 posts since March 19, 2006. (Sadly, the transition to the new WordPress platform has made a true count mysteriously difficult.)

firewalk with me, down the memory lane of Manhattan Loft Guy

Last year there was this bit of retrospective. As I said then, (use your Charlton Heston voice for the next three words) In The Beginning … I had no idea if this blog-thing would ever be a real thing:

 I didn’t tell anyone about that first post, or about any post for at least the first month or so, until I had made blogging enough of a habit that I could confidently predict there would be more (and more) content. In those days, there were a lot of real estate agents who announced they were blogging, but if you ever stumbled across their work you’d see two posts in the first month, and maybe another 3 in the next 6 months, then perhaps one or two more before their Google juice completely dried up.

Three years ago, I looked around a bit for older Manhattan residential real estate blogs (spoiler alert: they’re aren’t many):

how would Lorne Green count?
Five years is a long time in the blogosphere. The Miller’s copyright dates start in 2005, so even he is not much older than MLG. Ditto Brownstowner. Curbed, of course, is ancient, having started way back in 2004; but they pay people to do stuff over there ;-)  If there is a local Manhattan real estate blog by an individual older than Noah’s Urban Digs(August 2005), I don’t know it.

forward, into the future!

I continually frustrate myself by not moving social media projects from the To-Do pile to the Have-Done folder, but an anniversary is more inspiration to put real life nose to virtual grindstone and improve my use of multiple social media channels, in depth, breadth, frequency, and (for readers) utility. As always, I blog about Manhattan lofts because I follow Manhattan lofts … and I think about Manhattan lofts … and the process of writing down things I think about Manhattan lofts crystalizes some thoughts about Manhattan lofts … and it leads me to think more rigorously about the sales market for Manhattan lofts in a buy-or-sell neutral fashion.

The fact that the blog attracts clients who appreciate that this blog is a unique set of public expressions about this market niche and particular sales transactions is a wonderful side effect and, by now, a feature not a bug.

Resolved: to be a loftier Manhattan Loft Guy in Year Nine!

You’re welcome 😉

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