Jun. 12, 2009 - opportunity knocked at 60 West 15 St for $828/ft (and more), answered at $622/ft

the incredible vying architects + designers
The Manhattan loft on the 4th floor at 60 West 15 Street was marketed as a masterpiece (to be), with the interesting come-on that "architects and designers are vying to renovate" it. At "3,133 sq ft", there's a lot of work for those architect and designers to do. The raw materials include three exposures, columns, brick and high ceilings.

Jun. 11, 2009 - neighborly competition / laggard at 144 West 18 Street closes off 15% since December

first one to $1.7mm wins
Two Manhattan lofts at 144 West 18 Street (known, not poetically, as the Chainworks Building) closed 6 months apart. You won't be surprised to learn that the one that closed 6 months ago (#4N) closed higher than the one that closed last month (#3N), though I was surprised by the degree of fall-off. (I bet the June 2009 seller was really surprised.) Their remarkably similar tales demonstrate -- again -- the dangers (to sellers) posed by a thin market.

Both are "1,363 sq ft" and appear to be in very similar condition (unsurprising for a 2003 conversion). #4N did not brag about a lot: a "spa-like" master bath and a "spacious well laid out kitchen" is the extent of the puffery. #3N was similarly restrained: "a sleek, contemporary Arclinea kitchen and richly outfitted bathrooms".

very neighborly, very competitive (one 'won' easily)
The parallel histories to these two essentially identical Manhattan lofts are striking.
 

I have no information about the actual discussions that occurred between buyers and sellers, or between sellers and their agents, of course, but the basic facts scream out very different public positions for #4N and #3N. The #4N sellers challenged The Market to distinguish between the two units by starting at the same price as #3N 3 weeks after #3N had first been offered. After determining that The Market reaction to these two units at $19mm was "(yawn)", the #4N sellers then told The Market that they were serious sellers, by dropping $100k in 3 weeks and another $100k in another 4 weeks. They were rewarded with a contract in another month, for which they were able to hold very close to their last asking price.

The #3N sellers, in very stark contrast, were principled, or firm, or persistent, or stubborn, or hard-headed (add your favorite description here: ____). For which The Market hammered them. It took the #3N sellers two weeks after #4N went to contract off $1.7mm for the #3N sellers to drop the price at all, which they did by only $100k. (Stop the narrative here for a minute .... If The Market valued these two lofts at $1.675mm as of October 17, 2008 [as is proven by the contract for #4N], then it is reasonable for the #3N sellers to predict that they could attract a buyer willing to pay $1.675mm by offering #3N at $1.8mm. That is, this prediction is reasonable if and only if The Market is sufficiently liquid.)

how a reasonable prediction turned out to be wrong
This prediction (reasonable under certain circumstances) was wrong. It is obvious that no buyer appeared who was wiling to negotiate to pay anywhere near $1.675mm for #3N. Even after #4N closed on December 3, it took the #3N sellers another 2 weeks to drop -- and then only to the last #4N asking price. Again they were principled, or firm, or persistent, or stubborn, or hard-headed (add your favorite description here: ____), taking 2 more months to accept that they were reasonable-but-wrong, by dropping to $1.55mm. And that price drop took still 2 more months to generate the contract that closed last week at $1.425mm -- 15% off their upstairs (former) neighbors in #4N, who came to market 3 weeks after they did but who moved out 6 months before they did. (And those neighbors moved out a quarter of a million dollars ahead.)

It is difficult to imagine a better set of circumstances to illustrate how dangerous a thin market is to sellers: identical lofts, starting at identical prices, with the early bird getting the only worm out there.

comp value???
Going forward, how does one value another loft for which these two are good comps? Does this history prove that The Market for 6 year old lofts under 1,400 sq ft in southeast Chelsea dropped 15% in the first six months of 2009? I tend to think not, but that The Market over-reacted by punishing #3N so much for being so ... (you remember) principled, or firm, or persistent, or stubborn, or hard-headed.

But the only way to tell what The Market thinks is to see what The Market does....



© Sandy Mattingly 2009

May. 5, 2009 - is Chelsea Mercantile off 25% since 2007?

one data point says 'yes'
I have long believed that the Chelsea Mercantile conversion of the old Veteran's Administration building into residential lofts on Seventh Avenue at 24th and 25th Streets 'created' a new market for (lower) 'north Chelsea'. (From back in the day, when I talked about active listings, see my August 21, 2007 new at 150 W 26 / one of the Merc's children and my March 30, 2007 Chelsea's Merc merchandise / 5 open houses.) When that building succeeded from its opening in 2000 with a high level of services and its (then shocking) prices, the micro-neighborhood gained Manhattan loft competitors (neighbors) such as 245 Seventh Avenue (Chelsea Atelier) and 213 West 23 Street (the venerable "Y" of ancient song), and services such as Whole Foods. Hard to believe that we would have an Onyx (261 West 28 Street) or a Chelsea Stratus (101 West 24 Street) without The Merc.

There goes the neighborhood, indeed.

So I noted with interest the most recent sale at The Merc. #9U closed on April 22 after a long slog. This "1,665 sq ft" unit was originally 2 bedrooms plus (interior) office, but was opened up to a 1 BR + office layout, permitting dinners for 24 (at one table; did they leave the table behind??). The "U" line is south-facing, though some (direct) view south is blocked on this floor by the Chelsea Royale across 24th Street (blame the success of The Merc on that), though there's still lots of sky from here, plus angled views.

slog this!
It took these folks a year to sell from when they came to market in April 2008 at $2.5mm. Back in the day, that asking price was pretty reasonable, considering that #11U had closed on February 19, 2008 for ... $2.5mm. (That one must have an interesting story: there were 8 months between that contract and that closing.) Turns out, of course, that April 2008 was very close to The Top of The Market. So not only did they not get $2.5mm, as #9U got, they did not get $2.395mm (the June price), or -- seeing the handwriting on the wall -- $1.975mm (the price as of February 2009). That February 2009 price drop did the trick however, generating the contract that closed on April 22.

The #9U clearing price of $1.875mm is 25% off the (delayed?) price of #11U from February 2008, not to mention barely $1,125/ft. How the mighty have fallen....

getting the memo, or not
StreetEasy has the data on the current inventory at The Merc. You will see that quite a few sellers are priced within spitting distance of $1,125/ft, though some have taken some pains in getting to that neighborhood. Others have not gotten the memo (yet).

Mar. 12, 2009 - 2 closings at 36 West 15 Street / one was pushing it

This loft sold 2 years ago [November 28, 2006] for $860/ft [$2mm], bragging then only about a new kitchen. The new listing is all about being newly renovated. I suspect that they did not spend $300/ft on a renovation, but never mind ... it has not sold yet as the sum of (1) the 2006 purchase price and (2) $270/ft for renovation [$2.65mm]. It will be interesting -- in a vulture kind of way -- to see where this one ends up. As that reader suggests, I will keep an eye on it.

Feb. 25, 2009 - 2005 wasn't bad, was it?

bet the Under
There's a good-sized Manhattan loft in a north Chelsea conversion from earlier this century that sold in August 2005 for $1.575mm. Because they thought that 2008 was not like 2005, they tried to sell about 20% above that, but that did not work. The current asking price is close enough to the 2005 clearing price to suggest the smart money will take the Under, and not the Over on 2009 vs. 2005 here.

This loft does not have the light or proportions of others on higher floors in the same building, but it has a very nice level of finishes, rather high ceilings, a lot of space for the money (well under $1,000/ft), a great location (the nabe grew up around it). My sense is that -- back in the day -- it was priced (and traded) closer to the rest of the building than it will in This Market. (There's a smaller loft that found a contract quickly off an ask much closer to $1,000/ft, for example.) Overall, there is nothing wrong with this loft, but it seems to be being punished for relative disadvantages that did not seem so disadvantageous in other (prior) markets.

If these sellers stick it out, and go wherever they have to go to find a willing buyer, the 2009 clearing price will be lower than it was in 2005. The rest of the building seems to be in a more recent year, which strikes me as strange.

© Sandy Mattingly 2009  

Jan. 15, 2009 - Oculus squints just a bit to get it at 50 West 15 Street

© Sandy Mattingly 2009  

Dec. 11, 2008 - keeping it real in Chelsea (or not) as 'too pushy ...?' thread pushes on

buying like it is 2005
There is a new listing last week in one of my favorite Chelsea condos that tracks with my December 4 Goldilocks post (Goldilocks in the too pushy ..? thread in greater midtown). One of the smaller units in the brand name building (under 1,000 sq ft), it last traded three years ago around $1,150/ft. It is offered now at a 7% premium over that 2005 clearing price. Two high-floor units in the same line have closed this year within $5,000 of the new offering price so there should be a lower-floor discount from the asking price here, even if early-2008 market conditions continue to apply (not likely, right?).

selling like it is ... 2007, or 2011?
Another new listing this week in that (still favorite) Chelsea condo, but I can't tell in which year they have priced it. A 2-bedroom unit, it traded above $1,100/ft within the last 30 months. It is now offered for sale above $1,250/ft. Deal, or no deal? Deal in 2009, or in 2011??

The smaller Manhattan loft is priced 7% above its 2005 clearing price; the larger unit 14% above its 2006 trading level. I'd say one is closer to The Market than the other, but what will Goldilocks say? I have them both on MLG tracking. (And yes, it has been a pushy week in Chelsea.)

 

© Sandy Mattingly 2008  

Oct. 29, 2008 - rule breaking over celeb loft for sale at 142 West 26 Street

two Manhattan Loft Guy rules broker, for the price of one
I usually don't identify the current owners of Manhattan lofts for sale, or current residents in a building, out of respect for their privacy. And I usually don't comment on active listings from other firms (some of you may not remember this, end of an era for Manhattan Loft Guy / a new day dawns? from April 9). But I will make an exception in each case here, for reasons that should be obvious.

Curbed linked to a NY Magazine piece about CNN reporter Soledad O'Brien's loft being on the market for $4.6mm, with a video tour with reporter S. Jhoanna Robledo and BHS agents Russell Miller and Mary Beth Flynn. With the NY Mag coverage and the video tour, they are evidently trying to sell the apartment, so I will identify it with a clean conscience as the 5th floor at 142 West 26 Street (BHS web listing here).

Jul. 17, 2008 - Chelsea House flipper did not reach for stars, but got out via 6 week contract

modesty wins
The sale of  the Manhattan "loft" 130 West 19 Street Unit #6B that was reported this week in the inter-firm data base caught my eye as possibly the first flip at the Clarett Group's Chelsea House development (more "loft like" than true "loft", since it was built in 2006 but that's not a battle I am going to win). Next, I noticed it was a pretty quick sale (March 22 listing at $1.475mm, May 2 contract); the deed was filed July 3 at $1.45mm though only updated in our data base this week.

But what really stood out when I dug into the building history was that the asking price for this "1,100 sq ft" 2 bedroom unit was only $75,000 more than the 2008 seller paid as the original buyer in May 2007. The "profit" of $50,000 on the July 2008 flip of the May 2007 purchase is more than eaten up by the round trip expenses (two sets of transfer taxes, broker commission on sale being only the big tickets), which was very likely a bitter pill for the seller.

Props to the seller and PruDE agents Dennis St. Germain and Scott Allison for understanding where to price the unit to sell.

averages don't apply easily
This sale is an excellent demonstration that gross market data about year-over-year price appreciation is of very limited utility in looking at specific properties. Unit 6B appreciated 3.5% from May 2007 to July 2008, lower than the gains reported in any of the Second Quarter market reports, but the facts are the facts.

In fact, the July 2008 value for #6B is lower than the original sale price of the identical #9B in June 2007 ($1.475mm). The neighbors can't be happy with the modest price for #6B, but the seller must be happy to be out.

© Sandy Mattingly 2008

Jul. 15, 2008 - 130 West 17 Street #9S went for it + got it

how to determine "worth"?
A top-floor Manhattan loft at 130 West 17 Street was the subject of one of my occasional Going For It! posts way back on September 23, 2007 (when I was still commenting on other firm's active listings), 130 W 17 9S is new + really going for it. As in similar Going For It! posts, I was intrigued by an asking price that I could not find justification for in any traditional analysis -- nearby comps, past sales in the same building, particularly.

The price dropped on November 14 to $2.995mm, then they had a couple of "almosts": an accepted offer, then Back On the Market in January; then another accepted offer and BOM in February. Pay dirt came when a contract was signed on March 5, followed by a deed being filed June 5 for $2.85mm. (I saw that it had closed soon after, but waited to blog about it until the clearing price was available on ACRIS.)

Apr. 22, 2008 - waiting for the final number for Steiner sale / looks like a premium

Mar. 22, 2008 - first flip at Chelsea House, 130 West 19 Street?

Mar. 21, 2008 - the Steiner Building premium (or not) / 257 West 17 Street has a new one

Mar. 6, 2008 - don't sneeze at 130 West 17 Street contract

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it was going for it
I hit on (picked on?) # 9S at 130 West 17 Street when it was new to market in September (130 W 17 9S is new + really going for it), asking $3.2mm (since dropped to $2.995mm) for "2,000 sq ft" and the "possibility" of buying roof rights. I wondered then -- out loud, as is my wont -- if there was enough of a Manhattan loft plus factor here to justify a pretty large premium over past building sales.

For buyers to pay the primo premium asked for 9S, there's gotta be something special about it. The other sales in the building indicate that location is not the plus factor here. The views could be a plus factor, but they appear not to have helped 9N much. The "possible" roof deck should not be a plus, since (a) you'd still have to pay for it, and (b) it is merely possible at this point. (Out door space -- especially private roof space -- can be a significant plus factor, I just don't think this possibility qualifies.) Perhaps it is the finishes and fixtures.

For finishes and fixtures to be the plus factor driving an atypically high price, they have to overcome the buyer's mental math how much would it cost me to build out my dream loft? and it has to match the buyer's tastes. So the market of really interested buyers shrinks as the finishes and fixtures become more (personally) stylish. The seller wants a buyer whose taste exactly matches theirs, or else the buyer won't be willing to pay a premium.

did it get it?
Well, the chickens are near home and ready to roost. They have had the chickens warming up before (twice came back to market this year following accepted offers) but it is in contract as of yesterday's market updates.

Props to Deborah LaChance of Corcoran for getting this far at this price. Can't wait to find out the trading price....

[Update 12.14.08: the deed was filed June 5 with a clearing price of $2.85mm; my conclusion is that, yes, they did get it; even after taking 10% off the original asking price, they got a significant premium over past building sales]

© Sandy Mattingly 2008

Jan. 10, 2008 - 107 W 25 goes over ask / back story to NY Times item

Jan. 4, 2008 - real price drop at 112 W 18 but still a real project

still no size, but floor plan will do
I hit 112 West 18 Street #4C in an open house review when it was new 2 months ago (6 Sunday Open Houses in the 1.4s if you set your clock right), saying tersely: "yes, it is hard to get excited about such a "rare offering" without a floor plan or size…." At that point it was $1.495mm and $1,348/mo for a 3 BR + 1 bath "white box", but the price has just been dropped to $1.35mm.

architects, please call in
I don't know that I have seen a "white box" with 3 bedrooms before, but clearly this is being marketed as a gut-and-build job. The floor plan has since been added to the listing and shows plumbing in only one corner, which would be a major limitation to creative design if there are no risers elsewhere.

The space is (very) roughly 29 x 45 feet if the room dimensions are accurate, yielding something under 1,300 sq ft of serious renovation project. Using my new ballpark figure for a gut renovation of $200/ft (see Dec 10: need renovation stories / a reader writes for help), that is 'only' about $1,200/ft to buy-and-build in a central Chelsea location.

engineers, too
The key to whether this makes sense near this price point as a renovation project will be whether there are hidden (so far) issues with a renovation. Are there other risers? Does the whole place have to be re-wired?

But it is a condo with low monthly expenses ... if you are interested in a project and need only about 1,300 sq ft, this may get interesting for you.

© Sandy Mattingly 2008

Dec. 26, 2007 - 161 W 15 drops down to add up to contract

Nov. 19, 2007 - 3 firms, 7 prices, 3+ years / patience paying off at 521 W 23

Nov. 13, 2007 - wearing a $500k renovation on your sleeve / 158 W 23 is flipping

Nov. 8, 2007 - 142 W 26 still large, but fewer $$$