Manhattan Loft Guy

August 2008

Aug. 27, 2008 - 53 N. Moore Street #2F comes + goes with alacrity + humor

smiling over funny number
The Manhattan loft #2F at 53 N. Moore Street was first offered for sale on April 4 at $3.15mm and found a contract by May 11, so the sellers must have been happy with that progress. It shows as Sold + Closed in yesterday's updates, though I see that it actually closed on August 11 at a funny number: $2,938,288. Unless that number is the result of using someone's lucky numbers (the "8"s for good luck??), that must have been some intense negotiation. You just don't see too many transactions that don't end in three or more zeroes, unless there is a bidding war.

not The Beach
This condo was created in 2000 out of 3 factory buildings (according to our database; StreetEasy thinks there were 4) spanning Hudson Street from N. Moore Street to Beach Street (just below the Holland Tunnel spillways). Dubbed The Northmoore, the developer claimed the one of the 3 streets it fronts that would not seem as prosaic as the Beach or The Hudson.

modest pricing at the corner of Hudson + Tunnel
This is (so far) the only closing in the building in 2008. In 2007, #3A sold to the downstairs owner (a unique buyer, indeed) for $2.15mm (for "1,740 sq ft") on February 20; #5D sold on July 11 for $2.395mm (for "2,153 sq ft"); and Penthouse B sold on May 29 at $1.95mm (for "1,250 sq ft" plus a private terrace of "658 sq ft"). The $1,206/ft for #2F looks pretty good in comparison, although still light for a relatively new Tribeca condo with doorman. StreetEasy has these past sales, as well as information about any current listings in the building here.

Consistent with an 8-year-old conversion, #2F is said to be in mint condition, with (the original?) "chef-friendly granite and stainless kitchen", plus custom closets and storage. Although it is clearly not a floor-through unit (there are nine units per most floors in these 3 or 4 buildings), it has the classic Long-and-Narrow footprint of a full floor loft, with 2 bedrooms in back, the plumbing in the middle, and 2 big windows in the 26 foot wide living area (the floor plan is here, thx to StreetEasy).

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Aug. 26, 2008 - Manhattan loft inventory as of August 24

Number of Manhattan lofts offered for sale as of Sunday night:

price range	# of lofts
$500k to $999k	97
$1mm to $1.99mm	237
$2mm to $2.99mm	165
$3mm to $3.99mm	80
$4mm to $4.99mm	45
$5mm to $10mm	68
TOTAL	692

This is up 1 from last week, which is still (essentially) my two month low since I started counting (my first count on May 19 was 745). See my May 19 post for what I am counting, and why it is difficult.

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Aug. 25, 2008 - new Manhattan loft listings + closed sales in last 7 days

This is my forty-third report on the number, price distribution and neighborhood distribution for Manhattan lofts reported as new to the market or as closed sales in the last 7 days.

The stats as of Sunday night:

there were 25 Manhattan lofts reported as new to the market in the last 7 days and 20 as sold
18 of the 25 new ones are offered between $1mm and $3mm, while 17 of the 20 closed sales were below $2mm

9 of the 25 new loft listings are in new development, and half of the 20 closed sales were in new development (9 at be@William)

By price	New = 25	Sold = 20
$500k to $999k	2	11
$1mm to $1.99mm	12	6
$2mm to $2.99mm	6	1
$3mm to $3.99mm	3	1
$4mm to $4.99mm
$5mm+	2	1

By neighborhood	New = 25	Sold = 20
Battery Park City
Chelsea	4	1
Clinton
East Village	1
Financial District	4	10
Flatiron	2	2
Gramercy		1
Greenwich Village	9	2
Kips Bay
Little Italy
Lower East Side
Morningside Heights
Murray Hill
Midtown East
Midtown West
SoHo		2
Tribeca	5
Turtle Bay
Upper East Side		1
Upper West Side		1
West Village		2

New loft listings in new developments

1 Seventh Avenue South (One 7th)	1
41 Seventh Avenue South (The Luminary)	5
173 MacDougal Street	2
1 York Street (One York)	1

Sold lofts in new developments

420 West 25 Street (Loft 25)	1
90 William Street (be@William)	9

For information about how I get this stuff and why I slice it as I do, see methodology for New + Sold in The Last Seven Days. For my most recent rant about how soft this data may be, see loft or not? caution: active ranting ahead.

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Aug. 22, 2008 - paralyzed by history? another buyer dilemma

information overload?
I am working with a motivated, smart and analytic buyer who wants to know as much as possible about one particular Manhattan loft and its competitors before making a bid. This current experience points up an issue with smart buyers and one particular fact pattern: the loft has had three accepted offers in six months but is still available at roughly its original asking price. (The balance of the discussion is not about That Buyer; it's just General Stuff That Could Happen To Anyone.)

The problem is that not all interesting information is useful information.

what does it mean that 3 people decided not to buy?
It is easy to be distracted by a listing history that has been dutifully updated each time an offer is accepted, then again when it is back on the market. Some people step up and bid to compete with an accepted offer; others are morephilosophical and remain on the fence to see how it all works out. For those fence-sitters, the news that a deal has not been struck sometimes launches questions about what isknowable or not knowable, relevant or not relevant.

With 3 accepted offers but no contract in six months, one naturally wonders if there is something wrong with the loft or the building that is discovered in due diligence. While one can wonder, one can never know this until actually going to the effort of a negotiation and the expense of lawyerly Due Diligence. (Of course if there were some about-to-be-discovered Bad News, my opinion is that it should be disclosed by the seller's agent before or during negotiations, but that's another topic.)

On the other hand, if there had been no offers in six months, one might wonder if The Market perceives that there is something wrong with the loft at the price offered, leading one to question whether a loft that (a) you like and (b) can afford, is really worth it.

what can we know (that is useful or important)?
I tell my buyers that there are limits to what they can know about a loft or building during negotiations, that much more can be revealed during Due Diligence before they sign a contract, but that what other people think about that loft or have done in bidding or negotiating is usually only distracting or irrelevant.

Any buyer should be as knowledgeable about The Market and how a particular loft fits in The Market as the seller is. If a buyer thinks that a loft is over-priced because another one down the street is better / cheaper / larger, then that buyer will use that information (opinion) in a negotiation with the seller. If the seller is motivated enough -- and if there is no competing buyer present -- then maybe a deal can be reached. If a recent past sale in the same building implies a lower value than theasking price, the seller will know that and the buyer will too (most often).

Of course a buyer would love to know how much of a discount a seller has already agreed once to take, but -- unless the seller deems it in his/her interest to reveal it in negotiations -- the next buyer will not know.

reading tea leaves is hard
The best reason for not worrying about a fact such as prior accepted offers without contracts is that you don't know what it means and should not expect to find out. While it could indicate problems discovered in Due Diligence, it could just as easily indicate a seller being very negotiable with buyers who turned out not to be motivated or qualified.

If the (potential) problem is one that will come out only in Due Diligence, it will come out. The buyer may be upset with the seller and agent for sitting on something like that (I would be), but at least a buyer can be confident that it will come out before the contract is signed.

If the fear is that someone-knows-something-that-I-don't-know that is other than a Due Diligence fact, the only response is that (a) you can and should know anything that any other buyer could know and (b) no other buyer will have exactly your set of needs, goals and financial resources.

some people just like to sit on fences
Some people get it that there is risk in any loft purchase and move on to buy the most suitable loft. Other folks find a reason not to buy. Some of those other folks eventually figure it out, but some of them never do.

'tis a puzzlement.

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Aug. 19, 2008 - Manhattan loft inventory as of August 17

Number of Manhattan lofts offered for sale as of Sunday night:

price range	# of lofts
$500k to $999k	102
$1mm to $1.99mm	226
$2mm to $2.99mm	163
$3mm to $3.99mm	83
$4mm to $4.99mm	49
$5mm to $10mm	69
TOTAL	691

This is down 8 from last week, which is (barely) my two month low since I started counting (my first count on May 19 was 745). See my May 19 post for what I am counting, and why it is difficult.

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Aug. 17, 2008 - new Manhattan loft listings + closed sales in last 7 days

This is my forty-second report on the number, price distribution and neighborhood distribution for Manhattan lofts reported as new to the market or as closed sales in the last 7 days.

The stats as of Sunday night:

there were 20 Manhattan lofts reported as new to the market in the last 7 days and 50 as sold (the new development sales really kicked in this week!)
8 of the 20 new ones are offered between $2mm and $4mm, while 36 of the 50 closed sales were between $1mm and $3mm

only 4 of the 20 new loft listings are in new development, but 38 of the 50 closed sales were in new development (18 at Tribeca Space)

By price	New = 20	Sold = 50
$500k to $999k	5	7
$1mm to $1.99mm	3	25
$2mm to $2.99mm	4	11
$3mm to $3.99mm	4	3
$4mm to $4.99mm	2	4
$5mm+	2

By neighborhood	New = 20	Sold = 50
Battery Park City
Chelsea	3	1
Clinton
East Village		1
Financial District	3	7
Flatiron	1	5
Gramercy	4
Greenwich Village	4	1
Kips Bay		9
Little Italy
Lower East Side		1
Morningside Heights	1
Murray Hill		1
Midtown East
Midtown West
SoHo	3	1
Tribeca	1	20
Turtle Bay		1
Upper East Side
Upper West Side
West Village		2

New loft listings in new developments

420 West 25 Street (Loft 25)	1
173 MacDougal Street	3

Sold lofts in new developments

420 West 25 Street (Loft 25)	1
90 William Street (be@William)	5
20 Pine Street	1
15 West 17 Street	1
15 East 26 Street (Madison Square North)	9
127 Madison Avenue (M127)	1
105 Norfolk Street (Blue)	1
101 Warren Street	1
25 Murray Street (Tribeca Space)	18

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Aug. 14, 2008 - more about that Second Quarter / Manhattan loft data

Yesterday I (finally) hit the big firm reports on Manhattan real estate transactions (and other stats) from the Second Quarter of 2008 (about that Second Quarter / data party like it is 2006). Today it is whatever data is reported through the Big Three Firms (the Miller Samuel report; the Corcoran report; and the Halstead version, which carries the data from Terra Holdings) specifically on the Manhattan loft market.

The Numbers, with some year-over-year comparisons:

Lofts

	median sales price	avg price per foot	transactions	days on market	inventory
Miller Samuel	$1.7mm [up 3%]	$1,311 [up 5.2%]	272 [up 16.7%]	142 [up 15.4%]	548 [up 4%]
Terra Holdings		$1,170 [up 4.7%]
Corcoran	$1.888mm [up 16%]	$1,187 [up 1%]

(Do you see why I prefer the Miller Samuel data to the others??)

Once again, the money quote comes from The Miller:

Unlike other market segments analyzed in this report, the Manhattan loft market was characterized by modest appreciation with limited price skew and increased sales activity.

The relative richness of The Miller's data permits some comparisons within his data set of the loft niche to the overall Manhattan market, in addition to his comment above about "modest appreciation" (loft median up 3% YoY vs. 14.5% YoY for the overall market).

lofts are more scarce, take longer, but discount less

Most interesting to me is that Manhattan loft inventory (however he counts it) was up only 4% YoY, while the overall Manhattan inventory surge (sorry) YoY was 31%. In his world, lofts represented just less than 8% of the overall Manhattan inventory as of June 30, 2008, compared to just more than 10% of the overall June 30, 2007 inventory.

Lofts continue to take a little longer to sell than the overall market (142 DoM vs. 135; compared to 123 DoM vs. 117 last year), but the Miller-computed listing discount for lofts declined YoY from 3.4% to 2.9%, while the overall Manhattan listing discount increased in that year from 2.2% to 3.6%.

one nugget from Corcoran

The only YoY number of interest in Corcoran's report on the loft niche contrasts with The Miller's data that lofts under-performed The Market as far as median price. Corcoran reports that Manhattan lofts gained 16% in median value YoY, while the overall market gained (only) 13%. (Miller had it 3% for lofts, 14.5% overall.)

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Aug. 13, 2008 - about that Second Quarter / data party like it is 2006

better late than ...?
Of course there is a lot of instant 'analysis' when the big dogs bark out their quarterly market reports, not all of which is well considered. Indeed, note the differences in just these two headlines:

Apartment Sales Remain Vigorous in Manhattan [New York Times]

Wall Street’s ills weaken Manhattan apartment sales [NY Daily News]

The Miller collects many such media reactions on his Matrix blog when he reports the Miller Samuel quarterly data, which he did on July 2. (All the firms rush to get the reports out as quickly as possible, but putting them out two days before the Independence Day weekend certainly detracted from their prominence this past quarter.)

It is (more than?) about time that I commented on the Q2 reports, as I have been chewing on them for quite a while (and we are halfway through Q3). The most interesting take-away for me is how well 2008 is doing (so far) compared to 2006 -- not to the record-shattering 2007. As usual, I like the Miller Samuel report as having the most credible, sourced and comprehensive data. For this quarter's price data, the Miller's numbers are remarkably consistent with the data in the Corcoran report and the Terra Holdings report (here's the Halstead version): not only do all agree that Manhattan prices were up in the second quarter, but look at these averages and medians:

	avg price	median price
Miller Samuel	$1.67mm	$1.025mm
Corcoran	$1.675mm	$975k
Halstead	$1.663mm	$979k

Terra does not report an average price per square foot, but look at the agreement (coincidence?) between Miller Samuel and Corcoran:

	avg $/ft
Miller Samuel	$1,263
Corcoran	$1,262

transactions are down and up

Remember the prior quarter brouhaha when Terra threw some smack at The Miller about 600 transactions "missing" from The Miller's Q1 report? (April 14:

Mothra v. Godzilla, or the epic battle over Manhattan sales volume report

) The (irritating but unremarkable) gap this quarter is under 100: The Miller counts 3,081 transactions; Terra counts 2,988. The Miller always compares-and-contrasts, so we know that his Q2 count is down from the same quarter in 2007 by 22% but up from the prior quarter by 35%. Terra seems not Io think anyone would count that comparison as important, so it takes some digging through the Halstead archives to see that the 2Q07 Terra number was 3,469 while the 1Q08 number was 2,857. My calculator shows Q208 transactions in Terra World down 19% year-over-year but up 4.6% quarter-over-quarter.

The Terra reports strike me as more of a simple data dump, which is why I prefer the textual analysis common in The Miller's reports. Here's his money quote, following his discussion of why activity in 2008 is down from the record-breaking 2007:

Nevertheless, the number of sales to date in 2008 is at a higher level, and inventory is at a lower level, than experienced in 2006.

predicting the future ...

... not! No way am I going to tell you what is going to happen (note: I am not keeping it a secret). I will just say that if 2008 muddles along on a similar pace, it will have more transactions (and much higher prices) than 2006 -- which looks like a pretty good year (even in the rear view mirror) except when compared to the juggernaut of 2007.

Can 2008 muddle along like that? Beats me. But so far the Wall Street Blues & Layoffs have not provably ruined the Manhattan market.

I still owe you the loft data in the second quarter reports, I know....

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Aug. 12, 2008 - Manhattan loft inventory as of August 10

Number of Manhattan lofts offered for sale as of Sunday night:

price range	# of lofts
$500k to $999k	97
$1mm to $1.99mm	227
$2mm to $2.99mm	166
$3mm to $3.99mm	85
$4mm to $4.99mm	48
$5mm to $10mm	76
TOTAL	699

This is up 7 (1%) from last week, which has been my two month low since I started counting (my first count on May 19 was 745). See my May 19 post for what I am counting, and why it is difficult.

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Aug. 11, 2008 - new Manhattan loft listings + closed sales in last 7 days

This is my forty-first report on the number, price distribution and neighborhood distribution for Manhattan lofts reported as new to the market or as closed sales in the last 7 days.

The stats as of Sunday night:

there were 28 Manhattan lofts reported as new to the market in the last 7 days and 19 as sold
17 of the 28 new ones are offered below $2mm, while 14 of the 19 closed sales were between $1mm and $3mm

12 of the 28 new loft listings are in new development (all at 250 East 49 Street), while 5 of the 19 closed sales were in new development (4 at be@William)

By price	New = 28	Sold = 19
$500k to $999k