Manhattan Loft Guy

November 2006

Nov. 30, 2006 - Manhattan Users Guide on Nannyhattan

Depending on how you feel about protecting your In-Box, you should subscribe to Manhattan User’s Guide or just bookmark it and search regularly. Charlie Suisman has a lot of energy, a wide range of tastes and interests, and a virtually encyclopedic site. Troll the archives!

I won’t spoil the punch line of yesterday’s Article of the Day (Nannyhattan) but will note that he quotes the late lamented Betty Comden to great effect in ruing Manhattan being neutered.

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Nov. 29, 2006 - marketing 201 / sun and clouds out of alignment at 236 W 26

how not to sell a sun-drenched loft

The new listing from Corcoran for #601 at The Capital Building, 236 W 26 St, caught my eye this morning, since I was recently in the building to see the unit directly upstairs and it is always interesting to see multiple units in the same line in a loft building (a la the D Sale at 55 Hudson St -- Tribeca trifecta on the market / if you need a "D", 55 Hudson is for sale).

But what first caught my eye is the disconnect between the first word in the listing and the first picture on the website. (Either I am screwing up the formatting or Corcoran is blocking my ability to cut-and-paste photos from their website. Click on the listing info above to get the pictures.) How many people will look at the first photo and think "sun-drenched"??

Picture #3 is even worse.

windows, windows, windows, and windows

Which is a shame because the unit is sun drenched. Compare the floor plan to the pix and you will see that nearly all of two walls in the 35x17 foot LR are windows, facing south (35') and west (17') well above nearby roof lines.

Having recently been in (different Corcoran agents) The Smiling Blumsteins' listing upstairs in #701 I know that this is a "sunglasses" loft -- when the winter sun is low it is very bright here. So the #601 marketing reflects (no pun intended) the learning of Marketing 101 by addressing right off one of the key distinguishing features of this loft: it is more "sun drenched" than just about every other Manhattan loft on the market. (BTW, #701 is a combined loft extending to the east past the bedroom in #601, totaling 2700 sq ft, and is a beautiful loft. Open House Sunday noon – 1:30)

out of alignment

But Marketing 201 teaches that all marketing efforts must align. It is hard to sell a sun drenched loft to uninformed buyers by taking pictures on a cloudy day.

Bad luck to have a cloudy day. This will not be a big problem for buyers with agents who know the building -- because the floor plan alone will tell them that the sun drenches -- but how many such agents are there? It is classic bad marketing not to re-take your pictures to align with the objective facts -- especially if you lead your marketing with one objective fact.

as long as I have my knife out...

And another thing, while I am in a (hyper?) critical mood. In addition to the "gorgeous light from south and west windows" being contradicted by the marketing photos, the "open professional chef's kitchen" is essentially AWOL. Look again at Picture #3. I assume that really is an "open professional chef's kitchen" at the end of that loooong vista, but does that photo strike you as an "open professional chef's kitchen". Not to me, it doesn't.

The agents with #601 are experienced downtown agents who appear to be successful. Let's see if they re-take the pictures.

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Nov. 29, 2006 - precise numbers are credible … but accurate?? / NYO Qs re C-H rental vacancy rate

I blogged about the widely-quoted Manhattan rental vacancy “index” produced by Citi-Habitats last week (does anybody here know stats?), wondering how statistically significant it is.

Observer also wonders

Tom Acitelli at The New York Observer (late of The Real Deal; he can’t seem to escape The important capitalized article The…) wonders the same thing in Manhattan Rental Market Not as Tough as They Say (from page 10 in the 12/4/2006 edition of The New York Observer):

“those wishing to determine Manhattan’s rental vacancy rate are toiling in an uphill battle against incomplete data and an ever-changing market.”

estimates like zestimates

Acitelli identifies three factors that make “estimates” of rental vacancies seem like zestimates: 1) Manhattan has no true multiple listing service, 2) no one tracks coops and condos available for rent (Citi-Habitats does rental buildings only), 3) no one tracks available subleases.

I am not sure the source of his information about Citi-Habitats:

Citi Habitats bases its monthly vacancy rates on an analysis of its internal listings database, which includes 50,000 to 55,000 rental apartments. The analysis includes apartments in Manhattan below Washington Heights. The borough’s northernmost neighborhoods, Inwood and Washington Heights, are not, in fact, included in the analysis, and Harlem was only added this year.

monthly or semi-annually, 110 is a small number, right?

He refers to a monthly report (“[s]ince this time last year, the rental-market vacancy rate has been below 1 percent, according to Citi Habitats, settling at 0.80 percent in October, the last month for which data were available”) but I don’t find a monthly report on the Citi-Habitats website, only the semi-annual Black & Whites. As I said in my post last week (does anybody here know stats?), I read the Citi-Habitat Black & White Reports as based on no more than 110 buildings, not the 50,000 rental units Acitelli refers to. As I say, I can’t tell Acitelli’s source, but maybe he got it directly from someone at Citi-Habitats.

(A quibble with Citi-Habitats: why is this much quoted figure of 0.8% not been updated since 2005? If they do a monthly report, why isn’t it on their website? Mea culpas all around if it is there and I missed it.)

creating an INDEX out of whole cloth (best guesses), with trumpets

I agree with Acitelli’s conclusion and fact-based (skeptical) approach, however:

Citi Habitats’ attempt, then, like others, is a statistical best guess, only as thorough as the data—which, by the very nature of the Manhattan rental market, dangle incompletely. For instance, 50,000 to 55,000 apartments may seem like a lot for a survey (and so it is, for a rental survey), but there are at least 25,000 rental buildings in Manhattan, according to the Web research engine PropertyShark.com

And Acitelli adds a source with which I am not familiar that also sounds both precise and credible:

the city’s normally tri-annual Housing and Vacancy Survey put the Manhattan rate at 3.8 percent at the end of 2005, nearly unchanged from 3.9 percent in 2002.

Acitelli provides estimated residential rental vacancy rates in LA (around 3%), Chicago (around 6%) and Boston (around 5%) from a commercial real estate broker. Reporting a figure as “around 5%” does not sound half as accurate as reporting a figure with tenths of a per cent (a la Citi-Habitats), and it is probably 75.4% less likely to be quoted than a “Vacancy Rate INDEX”, but we are talking here about “estimates”, right??

But maybe Citi-Habitats wants to hear trumpets. Again, to quote Acitelli:

This low vacancy rate is trumpeted by the media soon after each report, sparking an outbreak of woe among recent college graduates, newcomers headed for Manhattan, ex-boyfriends who got the boot—just about any person trying to move to Gotham.

Tip of the hat to Curbed.com for linking to the Acitelli article in NYO.

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Nov. 29, 2006 - please don’t feed the sea lions (no … really … pretty please)

thinking of moving to San Francisco? / be careful out there

This news report is not funny. Really. But it is … interesting.

Some highlights:

“a rogue sea lion bit 14 swimmers this month and chased 10 more out of the water at San Francisco's Aquatic Park”

“a group of sea lions took over a Newport Beach marina and caused a vintage 50-foot yacht to capsize when they boarded it”

Told you it wasn’t funny. Read the article for even more.

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Nov. 27, 2006 - isn’t Williamsburg enough? / cities competing for hipsters

locking in 25-34 year-olds turns out to be important (maybe)

Interesting piece in Saturday’s NY Times about how the future of (some?) cities may be tied to their ability to attract the cohort of educated 25-34 years olds, Cities Compete in Hipness Battle to Attract Young.

The demographic driver is yet another Boomer-generated problem:

Baby boomers are retiring and the number of young adults is declining. By 2012, the work force will be losing more than two workers for every one it gains.

Reporter Shaila Dewan talks about cities that are actively trying to ‘recruit’ this age cohort (such as Portland, Oregon, Lansing, Michigan and Memphis), while noting that it is hard to create a marketing campaign that could work.

“What we’re seeing is the jury of the most skeptical age group in America has looked at Atlanta’s character and likes it,” Sam A. Williams, the president of the [Atlanta] Chamber of Commerce, said.

But Mr. Williams acknowledged the difficulty of replicating that phenomenon on purpose.

Had the chamber tried to advertise Atlanta, he said, “we might have screwed it up —because they’re much more trusting of their own network than they are of any marketing campaign.”

Atlanta paid for the study; they win

Atlanta commissioned a study of 1990 – 2000 census data, which showed that the biggest gainers in this cohort were Atlanta, Denver, San Francisco, Portland O and Austin. The biggest losers may surprise you: Washington, Philadelphia, Los Angeles (!) and New York (!!).

One could argue that these data are too old to be useful, as the characteristics of such a small age cohort changes over time. One could argue that trying to chase generational fashion is doomed to fail. One could argue almost anything, I suppose.

Studies like Atlanta’s are common these days. From Milwaukee to TampaBay, consultants have been hired to score such nebulous indexes as “social capital,” “after hours” and “vitality.” Relocation videos have begun to feature dreadlocks and mosh pits instead of sunsets and duck ponds. In the governor’s race in Michigan this fall, the candidates repeatedly sparred over how best to combat “brain drain.”

The data are probably easy to misinterpret, making it difficult to “try” to appeal to this cohort.

At the Charlotte Chamber of Commerce, Tony Crumbley, the vice president for research, said the city and state had done a lot of things right without realizing it, like establishing liberal banking laws that made Charlotte a financial capital, and redeveloping downtown in the 1980s.

“Another thing,” Mr. Crumbley said, “there are more Frisbee golf courses in this area than any other place in the country.”

Still, what works in one city will not work in others, Mr. Cortright said, and not all young people are looking for the same things. He cites Portland’s bike paths, which many point to as an amenity that has helped the city attract young people.

“I think that confuses a result with a cause,” Mr. Cortright said. Portland happened to have a group who wanted concessions for cyclists and was able to get them, he said.

“The real issue was, is your city open to a set of ideas from young people, and their wish to realize their dream or objective in your city,” he said. “You could go out and build bike paths, but if that’s not what your young people want, it’s not going to work.”

hope for Manhattan?

But there is hope for New York (of course).

They are people who, demographers say, are likely to choose a location before finding a job. They like downtown living, public transportation and plenty of entertainment options. They view diversity and tolerance as marks of sophistication.

Let’s see… downtown living (whatever that is), check; public transportation, check; entertainment options, check; diversity and tolerance, (a hopeful) check.

But, if it comes down to affordability (d’oh) all the checks in the world may not help Manhattan.

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Nov. 27, 2006 - rebels in REBNY may repel web listing portal

who at REBNY wants this thing, and why?

I blogged about the Nov 1 announcement by the Real Estate Board of New York about plans in the Spring to establish an internet portal for REBNY-member firm listings (A Giant Step for REBNY, but how big a step for humankind). At the time, I wondered (1) why they were making the announcement so far in advance (what was the urgency of announcing?), (2) who it was designed to ‘get’, and (3) whether the announcement had anything to do with the federal investigations into potentially anti-competitive practices in Manhattan.

I took the announcement as a fait accompli, on the theory that they would not announce anything unless it was a done deal. Silly me.

power rumblings, smaller snipings

The first public rumblings of discord in REBNY-land were in The Sun, quoting the head of PruDE the day after the announcement as saying it was not a done deal:

Nobody has really agreed 100% to anything yet," Ms. Herman said. "There are some roadblocks that people haven't agreed to at this point."

Since PruDE is one of the two largest residential brokerage firms in Manhattan, that was an eye-opener, leading to further questions about why REBNY made the announcements before all the ducks had fallen into place.

drawing eyeballs to small firm listings?

The Sun also quoted smart-guy Jonathan Miller, who opined that such a portal would help smaller firms that do not promote their own websites (which would be linked to this portal) as well as the mega-firms.

Mr. Miller said that a shared public database could erode some brand distinction between companies that spend a lot of money on promoting brands. Traditionally, New York's firms have been associated with certain neighborhoods, kinds of apartments, or income levels, and that is changing, he said.

"REBNY seems to be in a position now of blurring the distinctions among their members," Mr. Miller said.

The head of Warburg is a frequent source of Real Estate Industrial Complex establishment commentary; he did not disappoint the establishment’s ‘never mind’ set:

The president of Warburg Realty Partnership, Frederick Peters, said that new portal would not drastically affect the city's real estate landscape. He said the major change came about a decade ago when firms first started sharing information about listings with each other. Previously, a broker with an exclusive apartment listing was reluctant to split commissions with another broker who found a buyer.

Then Curbed posted a memo supposedly sent last week from some of the smaller independent firms, REBNY Web Portal Mutiny Brewing? The claim of at least some smaller REBNY member firms is that the web portal will disproportionately benefit the larger firms.

From an exposure point of view, I disagree. If the web portal ever goes live with all member firms’ listings, the listings of firms such Ardor, Klara Madlin, Flatiron, and DG Neary will be as exposed as those of PruDE and Corcoran. So I agree with Miller. But the money….

… at what cost?

At the reported fee structure of $3,000 for small firms and $7,000 for large firms, the smaller firms are getting hosed.

Many of the small firms in REBNY have less than 5% of the agents and exclusive listings as Corcoran and PruDE. Yet they will be billed at 3/7 the rate of the Big Boys and Girls.

I think this is awkward for the small REBNY firms, but I don’t believe that REBNY is out to ‘get’ them (its own members!). Whose ox is to be gored??

My best guess is old media and new media.

attacking the Old Grey Lady?

Firms pay a fortune for NY Times advertising, in paper and on line. This whole open portal effort may disappear if the Times rates drop. Up to now, the Times has had no real competition, and the firms have had little leverage. But this announcement changes that calculus.

or feeble roadblocks aganst new media?

New media like Trulia, Easy Street, Google Base are definitely a threat to firms’ control of listing data, but I don’t think REBNY can compete with the New Guys on their turf. They are *way* too focused and *way* more advanced about internet marketing than REBNY will ever be (witness Fred Peters remarks in the Sun). So if REBNY hopes to hold off the new media by putting up its own web portal … they lose (sooner or later).

The feds? Maybe this is a small step taken to show federal regulators that REBNY firms are acting with the best interests of the consumer in mind. If so, too little too late. And probably beside the point, from the government’s perspective.

toe-holds in Brooklyn?

Maybe this is another beachhead in the efforts by several major Manhattan-based firms to compete in Brooklyn. (If Manhattan real estate practices are in the 20^th Century compared to the rest of the country, Brooklyn is still in the 19^th Century.) This may be part of a still-to-come public relations effort to further loosen the hold that the several larger Brooklyn firms and the many mom-and-pop shops have on the Brooklyn listing market, in which cooperation among firms is … primitive.

or a different conspiracy?

One possibility for conspiracy theorists is that this portal is another attempt to under-cut the 30+ firms that are not only REBNY members but are also members of the Manhattan Association of Realtors®. This year those firms set up an IDX (Internet Data Exchange) that – like similar Realtor® organizations around the US – permit any MANAR member firm to put other MANAR firms’ listings on their websites (with the exclusive agency identified only in the fine print). So in the rest of the country, where nearly all the firms in most markets are Realtor® firms, consumers can get virtually all listings from the websites of virtually any firm.

Not in Manhattan though, as the REBNY establishment firms have never joined the National Association of Realtors®.

Remember that quote from Warburg’s Peters about the major change in local practice “about a decade ago”, when REBNY firms began to share listing information? Well it was really only about five years ago that REBNY even had a rule that required listings to be shared within 72 hours. Coincidentally or not, that rule change (definitely a major change, btw) followed the formation of MANAR and the agreement by MANAR firms to share exclusive listing data. Coincidence or not, the original MANAR firms formed MANAR after trying within REBNY to get a rule requiring that exclusive listing information be shared on a timely basis.

So maybe this is REBNY’s way to show it is as ‘relevant’ as the Manhattan Association of Realtors®.

confused? Maybe REBNY is too

Or maybe there is no grand conspiracy here; maybe there is no one REBNY is trying to ‘get’. Maybe this is an example of the FUBAR principle at work, as this announcement has drawn opposition from one of the two largest member firms and a whole bunch of its smaller members. Maybe REBNY is just out of touch.

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Nov. 26, 2006 - Tribeca trifecta on the market / if you need a "D", 55 Hudson is for sale

same building, same line, similar (aggressive?) price, for different layouts

NY Times On the Market today included a loft with some classic attributes, including arched windows, vaulted ceilings – and an awkward bathroom arrangement. Turns out that is one of three units for sale in this building in this line.

a 2 BR classic loft layout

55 Hudson St Unit 7D is marketed by Stribling’s Michael Chapman. The Times doesn’t say so, but this unit is said to be 1,500 sq ft and is offered at $1.85mm (maintenance $1,790/mo). There’s nothing wrong with 55 Hudson, but I am not sure I would call it “Tribeca’s best coop” (interesting question, that; so many condos down there; but no doorman here).

It looks beautiful and has lots of light and windows (a corner unit). The layout is efficient, except there is that classic loft problem: the bathrooms and kitchen are along the one ‘wet’ wall (where the plumbing stacks are), so one must travel from either bedroom to either bathroom. Not the best layout for many folks, but a common problem in classic lofts.

same footprint, 3 BR layout

As it happens, Mary Ellen Cashman at Stribling is marketing the same unit one floor up. Unit 8D does not look to have the same level of finishes, but it has an interesting 3 BR layout that almost solves the travel-to-bathroom problem with this loft. Asking $1.8mm for that one (Cashman is more modest about 55 Hudson: “one of downtown’s most sought-after coops”).

or the 1 BR edition

Curiously enough, yet another Stribling agent is selling the same unit one flight down. Unit 6D is offered by Bruce Ehrman at $1.865mm, so there is little doubt where Stribling thinks the right price is for this line. This one has a very different layout (set up as only 1 BR, 1.5 baths, so 6D solves that problem while creating others). For Ehrman, 55 Hudson is (more modestly still) the “ultimate convenient Tribeca address”. Ehrman thinks this is a 1,600 sq ft layout, however. No arches in these windows, and that looks like glass brick in the MBR photo.

So if you love the building, do you want that with one Bedroom, two Bedrooms, or three?

Has Stribling guessed the price in the $1.8s, or are they playing chicken with each other?

Based on the four sales in 2006 in this building, it looks hard to justify much more than $1,000 a foot here.

how much more than $1,000 a foot?

2006 was the year of the “A” line, just as they hope 2007 will be the year of the “D” line. 4A and 7A closed in January 2006, 6A closed in October, while 7C closed in June. The “A” line is 1,270 sq ft and the prices were

	Closed price	Asking price
4A	$1.15x	$1.095
7A	$1.295	$1.295
6A	$1.24	$1.249
7C	$1.15	$1.15

I don’t think the option to have 3 BRs in 1,500 sq ft will justify that much of a premium over the 1,270 sq ft sales. Let’s see what the market thinks….

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Nov. 21, 2006 - does anyone here know stats? / the widely quoted Rental Vacancy Rate from Citi-Habitats

data point about rentals tracked down (it wasn’t hidden)

That NY Times piece from Sunday, Changing Course to Avert a Glut, addresses macro-level questions about plans to build lots of condominium in Manhattan. Among the data nuggets reported by Christine Haughney is the oft-quoted statistic from Citi-Habitats for the vacancy rate for Manhattan rental apartments.

“Converting projects to rental apartments is starting to make more sense because this sector has strengthened. The vacancy rate for rental apartments in Manhattan is a very low 0.8 percent, according to Citi Habitats, a Manhattan real estate brokerage. The borough hasn’t had such a small percentage of rental vacancies since before Sept. 11, according to Gordon Golub, Citi Habitats’ senior managing director of Citi Habitats.”

I don’t recall ever seeing any report about rental vacancies in Manhattan that were not sourced to Citi-Habitats.

small number, small sample?

I’ve got nothing against Citi-Habitats, but I am skeptical by nature and I am curious about that number, 0.8%. I have no reason to doubt it as accurate, but a number that small deserves a bit of scrutiny.

Citi-Habitats puts out a semi-annual market report focused mostly (but not exclusively) on rentals in Manhattan. I usually don’t pay a lot of attention to rentals but there is a lot of good stuff in The Black & White Reports, the most recent of which is for the last half of 2005.

the source in black & white

Page 5 of that B & W provides information for the rental vacancy statistic, which struck me as a little lean for an island with 564,721 rental households (as I discovered when I blogged earlier about this NY Times article). The stat is based on a “sampling of 8-10 key rental buildings in each Manhattan neighborhood below 100^th Street”. They count 11 neighborhoods, so that is a minimum of 88 buildings surveyed, and a maximum of 110 buildings. If the average size rental building has 100 units, that is about 5,000 ~~buildings~~ units.

I have no idea, but is 110 buildings a large enough sample to be statistically significant? I suppose the number is self-validating to the extent that it is consistent over time, but I gotta wonder about that.

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Nov. 20, 2006 - gluttony without turkey or pie / new condos in Miami, Las Vegas and Manhattan

my excess is bigger than your excess

That NY Times piece Sunday, Changing Course to Avert a Glut, provides some comparative data about condo development in Manhattan, Las Vegas and Miami (on the theory that we all feel better when others feel worse, I guess).

First some context from the US Census Bureau website about the number of people, number of households, and the breakdown of rental households against owner occupied housing, using the 2005 estimates (available on the Fact Sheet for each county or city):

	population	Total households	Rental households	% renting	Households owning	% owning
Miami–Dade	2,300,000	834,800	488,681	41%	346,119	59%
Las Vegas	539,000	204,688	84,053	41%	120,635	59%
Manhattan	1,600,000	731,439	564,721	77%	166,718	23%

83,000 can be a much larger number than 82,000

With this context, the 83,400 condos under construction or planned in Las Vegas is a rather staggering number, much more so than the 82,486 in Miami (assuming the Times is talking about Miami and Dade County) or the 28,358 in Manhattan.

Talk about rolling the dice….

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Nov. 20, 2006 - hard data is good to find / nuggets in NY Times glut aversion piece

condo pipeline is an issue

The NY Times piece yesterday, Changing Course to Avert a Glut, addresses macro-level questions about what may happen if all the planned condominium apartments in Manhattan are built. In the course of the article, a number of useful data nuggets are revealed.

coops still out-number condos by 4 to 1

According to REBNY, there are 138,000 coop apartments in Manhattan and 36,000 condos. There are just over 14,000 units in condo developments that have already broken Manhattan ground and just under 14,000 in projects still in the planning stages.

So if all 14,000 being built are finished off as condos, the coop to condo ratio will switch to less than 3:1. And if the ‘planning stage’ units are added as condos, the ratio will be closer to 2:1.

But it looks as though not all these units will be developed as condos (or, perhaps, at all).

“Real estate brokers are advising developers to turn some of these projects into anything other than condominiums: rental apartments, hotels or office buildings. And some major banks that lend to condo developers are cutting back on loans for proposed projects or for land that developers want to buy.”

details on condos not being developed

Reporter Christine Haughney cites as examples: 425 Fifth Av (an office building that was aborted as a condo due to poor sales results that will become a hotel); the Gwathmey Siegel “Design for Living” at Astor Place (where 7 of 39 units will be rentals “partly because of a complicated [unexplained] tax structure [that just popped up??] and not just [because of] the state of the condo market”; three Extell buildings that will mix condos with rentals or with hotel rooms (on Riverside Blvd, at 135 W 45 St, and at 151 E 81 St); a condo at 23^rd and 3rd that may mix rentals and condos; and a mixed condo and hotel project at 53^rd and Madison that Macklowe Properties will put up as an office building instead.

That looks like a trend to me….

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Nov. 16, 2006 - more Days on Market delirium / a flaky stat for individual sales (the 160 Bleecker example)

the 6 months sale that was pretty quick

Today’s NY Times ‘Residential Sales’ feature includes a studio sale at 160 Bleecker that was on the market “24 weeks”. I checked the details, wondering about the price history of this (seemingly) hard-to-sell unit. What I found illustrates the degree to which individual closing data for Manhattan lofts and apartments can be screwy.

Turns out that #9A-W was really a pretty quick sale, though it took a long time to close. It came to market in March and was in contract within a month. But it took more than four months to go from contract to closing (particularly in a condop that has to have all-cash purchases), for reasons unknown.

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Nov. 15, 2006 - news alert! well-priced lofts sell (sometimes quickly) … d’oh! / a tale of 2 lofts at 22 W 26

is ‘the glut’ limited to over-priced lofts?

When I work with buyers – and especially when I work with sellers – we have long conversations about inventory stats and whether they indicate buyers have “a lot” of power in the current market. In my typically infuriating way, my answer is consistently “it depends”.

all buyer-vs. seller power is very local

Buyers definitely have more power than they had in 2005 but well-priced lofts still attract strong interest from well-qualified buyers. The stuff that has been on the market for a while (and which may be suffering death-by-small-increments, like #8A at 4 W 16 St, which is still on the market at $1.225mm) give buyers relatively more power. But if a loft is well-priced they should expect competition.

We just went into contract on an apartment I listed (full price, with competing offers, in 5 weeks), but two loft listings at 22 West 26 St are better illustrations of this.

First, the good news

#12B is in contract after three weeks as of this weekend, with competing offers, off an asking price of $2.195mm. In any market conditions, that is a terrific result for the sellers who owned the loft for 2 ½ years and just completed a major renovation. This is a beautiful top-floor loft with great light, about 2200 sq ft.

Next the not-so-good news (for sellers)

#2B has a similar price and a slightly smaller floor plan than #12B and is – to (legitimately) use an over-used word – a unique and special loft. No kidding – it has to be seen to be appreciated. It has been marketed by Corcoran only since September (at $2.199mm) but it was offered last year by Sotheby’s for $2.695mm, then $2.55mm, then $2.275mm until it dropped off the market. This in a building in which the top sale to date was $1.81mm.

Second-guessing is so unrewarding, but it is hard to believe that it would not have sold last year off this year’s $2.199mm asking price – but the sellers and/or agents were not prepared to do that then.

Now the listing is well familiar to agents who specialize in lofts and is still available. Granted, #2B has a much more limited market than #12B (the way that all truly “unique” lofts have more limited markets) and has some 'second floor' issues, but it is still out there while #12B came and went in a (relative) flash.

Buyers looking at #2B may feel that they should have a lot of power. The two buyers (at least) who competed for #12B will have a different view of who had the power in that negotiation.

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Nov. 14, 2006 - loft = designer clothes / the award for most interesting description of loft living goes to…

… the eco-conscious Tribeca mom with the guilty conscience (and the Prius)

One nugget from Sunday’s ‘Habitats’ section of the NY Times Real Estate section.

The mom with the automobile commute to the Upper East Side with the junior high daughter had a lovely way to describe the luxury of loft space in Manhattan:

“I had theorized that in Manhattan, where the rarest, most prized commodity is space, that the loft is the ultimate form of conspicuous consumption because you have all your space on display at once,” she said. “It’s like wearing all your designer clothing at the same time.”

She also gets an award for her triple play with “grubby”: her former “grubby little one-bedroom” apartment, her boyfriend’s former “grubby little studio” apartment, and their current loft lobby, which is (yes) “grubby”.

This essayist and novelist has a way with words!

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Nov. 13, 2006 - death, taxes and … private school tuition? / the politics of stay-or-go

do Manhattan private school vs. suburban public school anecdotes make a story or just sell papers?

Fascinating piece in Monday’s NY Times about parents leaving Manhattan for the idyllic schools of ‘burbville and then end up springing for private school tuition anyway. I am not going to get much not the content, as you should tread the story. There is lots of stuff there.

It seems to me that the papers often run certain stories on a cycle: first a young-adults-moving-to-‘burbs-for-cheaper-living story, followed six months later by a young-adults-moving-back-to-city-for-any-kind-of-living story. But this one is a new angle on me.

It is good as “news” because it runs counter to mass assumptions (a la a man-bites-dog story). When these stories are built on anecdotes, however, I wonder how ‘real’ they are. Has the Times come across a developing trend? Or have they just run a story that will justify the choices of Manhattan residents to stay put?

causation or coincidence?

There is one sense in which I think the history of Manhattan loft living is related to schools. I believe there was a general trend beginning ten or fifteen years ago for families with children to stay in Manhattan (rather than move to the ‘burbs for the ‘quality of life’ for their kids) because the Manhattan qualify of life not only improved, but was the subject of many news articles as starting to improve. So more people were drawn to larger apartments, often to lofts.

the lure of PS 234

More people who had the money to choose to send kids to private school instead of opting for the ‘free’ public school sin high-tax towns like Scarsdale and Great Neck decided to stay. PS 234 in Tribeca had at least some impact on this in the 1990s, as it became a ‘poser child’ school for loft-dwellers who wanted to send kids to public schools.

I suspect (no data, so don’t ask) that the typical loft buyers n the last fifteen years are younger than the typical apartment buyers, and more apt to have school-age kids. So my hypothesis is that if the quality-of-life in Manhattan had not improved for families, fewer lofts would have been developed these last 15 years.

Just a hypothesis.

touchy arguments this week in some households

Read the Times article. Fascinating stuff. I am sure there are some parents of three-year-olds who are having the stay-or-go argument this week because of that front-page article, which was the most frequently emailed article of the day on NYTimes.com.

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Nov. 13, 2006 - a run on turtles / NY Post also discovers Turtle Bay lofts

like a Time & Newsweek cover coincidence, almost

In addition to Sunday’s NY Times ‘On The Market’ that featured #15M at 319 E 46 St, which I mentioned yesterday (real loft discovered in Turtle Bay / NY Times features small loft in funny place). Saturday’s NY Post included a small loft in the same building in the ‘Just Sold’ feature.

Another problem counting Days on Market

#9H was sold by Corcoran‘s Howard Spiegelman for $925k off an asking price of $949k, but it really took much longer than the 49 days reported by the Post. The inter-firm database shows that #9H was offered for sale in January for $1.075m then reduced in price to $999k in March, then to $949k on June 3. The contract was signed on June 16 and finally closed on September 18.

This illustrates the difficulties on getting useful data for Days on Market, which I have commented on before. The contract was signed “only” 2 weeks after the last price reduction and closed 16 weeks after that price reduction. But it was on the market for about 20 weeks before final contract and more than 30 weeks until closing. Looking at this history, I don’t see any way to count and get 7 weeks.

Anyway, this unit is said to be 1,433 sq ft with maintenance of “only” $1,700/mo (why is #15M’s so high??). It included a “standing tanning bed” in the master bedroom.

Spiegelman – like Gina Kuhlenkamp -- makes a living off this building. He’s the guy who had five open houses there on Sunday. His listing said “this one will not last” which turned out to be a bit of a stretch.

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Nov. 13, 2006 - from tennis elbow to PDA pain

signs of the times: massage therapy for tired thumbs

Attention Masters of the Universe (and other Blackberry, Treo and similar PDA users): it can hurt to over-use your device, as you may already know. But if you stay at some Hyatt Hotels you can get a special massage for people who have thumb and hand pain from typing on those tiny keyboards, as a story carried by Reuters explains.

I have never had this problem typing emails on my Treo, but then I usually don’t want to type more than ten or fifteen lines in a Treo-email, let alone a short novel.

Here’s a helpful (?) tip from an ergonomics expert at Cornell University:

``Don't type ``War and Peace'' with your thumbs! If you need to type long messages use an external keyboard for the device,''

(Almost makes me proud that our youngest will graduate from Cornell in May.)

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Nov. 11, 2006 - (no irritating Ps but) more seller psychology / are loft-sellers more prone to ego errors?

the Lake Wobegon effect?

My P-filled post about sellers not adjusting to the current market (pseller psychology pstuck pso psales psuffer?) leads to wondering about Manhattan loft sellers.

Although my prior post talked a lot about ego-driven decisions for sellers, I am not suggesting that loft owners are more ego-driven than other Manhattan apartment sellers (really – I am not). But I think that Manhattan loft sellers (and Manhattan loft owners in general) are more likely to think of their lofts as “unique” or at least “special” that apartment owners who can see that the genius of their apartments is in the decoration (their personal taste is sublime) rather than in the four walls and floors.

all lofts are above average…

At least that’s my theory. And it is related to the reasons that I think it is harder with lofts than with apartments to get true ‘comps’.

Because apartment owners are much more likely to believe that they live in an apartment that is “just like” their neighbors’ apartments in the same building, except for the personal touches that make it uniquely theirs – most of which they will take with them when they move.

… or at least unique

Loft owners are more likely to live in Garrison Keilor’s Lake Wobegon, where all children are above average. In Manhattan, most lofts are “unique”, so loft owners are tempted to believe that the “general” market trends (flat or down, of late) simply do not apply to their above-average lofts.

Indeed, they may derive perverse pleasure in thinking that their loft is so special that only special people will appreciate its charms, and the longer it stays on the market the more they are convinced that it is more and more special. Perverse, as I say.

the longer it takes to sell, the more special it is (maybe)

With that mind-set, the data about greater inventory and longer days on the market can be rationalized as “problems” only for apartments that are not so special.

I will have to start paying more attention to lofts that have been on the market for quite a while without a single price change. Those may be examples of loft-sellers-with-ego (not that there is anything wrong with that). Or loft sellers who are waiting for the right buyer to pay the right place.

So long as their agent is patient – and they are patient with their agent – everyone will stay happy….

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Nov. 11, 2006 - real loft discovered in Turtle Bay / NY Times features small loft in funny place

2d Av loft building – go figure

Today’s NY Times ‘On The Market’ features a loft that is unusual in at least three ways (not counting the green walls): it is just off 2d Av, it is under $1mm, and it is a prewar doorman building.

But it is legit. The building is a former factory and the loft has 14 ceilings, big windows and a sense of space. (No comment on the green walls.)

#15M is offered at $825k for 1,000 sq ft by Bellmarc’s Gina Kuhlenkamp, who looks as though she makes a living in this building. As Vivian Toy in the Times notes, it has river views, is airy and light but (Grey Lady understatement??) “maintenance is on the high side”. At $2,045/mo for about 1,000 sq ft, I would say the maintenance is on the very high side, especially for a building with so many units (300+). But the building does have a fitness room and roof deck, as well as the doorman and renovated lobby and hallways. Regardless, two bucks a foot is a lot. My guess is that their taxes are very high and/or they have been left with a very high underlying mortgage from the conversion in 1988.

TurtleBayTowers is a condop. There are 13 units for sale, from a 500 sq ft “loft” for $395k to a penthouse 1500 sq ft unit for $1.39m (with maintenance of $4,755!), with FIVE open houses today. But not this one.

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Nov. 10, 2006 - pseller psychology pstuck pso psales psuffer?

Sellers are slow to adapt to current conditions, say some

Jonathan Miller on Matrix started a chat about seller psychology, expressing the view that (in general) sellers have not accepted the current market facts.

One of the interesting points he makes is that his experience is that it used to take sellers three calendar quarters to adjust to a weakening market, but this time it is taking five quarters (and counting, for some stubborn sellers).

Then, setting prices involves more ego than greed for sellers, which can explain why appeals to pure logic don’t work so well. The Washington Post article he cites says:

Economic researchers have found that emotions are a bigger influence than was previously believed in how people make financial decisions. For a long time, economists believed that human beings made decisions like robots, that people applied simple logic in making financial choices. But a body of research developed over the past two decades, known as neuroeconomics or behavioral economics, has shed light on how powerful a role the unconscious mind plays. New imaging technology, meanwhile, is allowing scientists to peer inside people's brains while they wrestle with financial decisions.

These studies have illuminated a few key concepts: Many people will pass up sure profits for illusory ones. Some will turn down profits if they believe someone else is unfairly profiting more. Some will even refuse to sell if they believe they may come to regret it, because fear of future regret can be as powerful a motivator as money in the pocket today.

In other words, people will cling to prices they recall from a brighter day, even when market conditions have changed; they will walk away from a sale if they feel the buyer is getting too good a deal at their expense; and they are terrified that [if they sell now] the market will rebound and they will feel like fools.

Miller’s “solution”?

Brokers need to continue to educate the sellers on the accurate value of their property and simply don’t take the listing if its not priced within the realm of reasonableness.

Easier said than done, especially in a market in which some agents will “buy” listings by over-promising on price, in ways that support sellers’ natural inclinations to be optimistic (as Miller’s comment from blogger Urban Digs illustrates).

But essential. Otherwise, why should they pay us the big bucks?

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Nov. 10, 2006 - elections can be rough / not those elections – coop boards

LincolnTowers coop board election generates defamation suit

The Daily News reported on a defamation suit brought by a candidate for the coop board in one of the Lincoln Towers, showing that electoral hardball is not confined to traditional politics.

playing hardball in Manhattan coop board elections can be costly

One resident dug up some dirt on a Board candidate last May and will answer to a jury in a defamation suit. It was okay to call the candidate a pornographer (based on photos on his modeling agency website) and to talk about his 24 year old grand larceny conviction, but it was not okay to imply that the candidate had sex with minors. The 56 year old candidate explained that his girlfriend is 22 (and “turning 23 soon”).

You can’t make this stuff up….

THX to Gothamist for the head’s up.

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