Aug. 28, 2009 - one less funny person at The Porter House

... unless the buyer is a clown?
I checked in at 66 Ninth Avenue (The Porter House) on August 16 (Porter House loft may be "beyond the beyond" but sells off a million, up 40% or down 25%) to tell a tale of  Manhattan loft sellers who recently closed 40% above their November 2003 purchase, but down 25% from where the upstairs neighbors sold while they were on the market at the wrong price. Yesterday's The Real Deal updates that building's news to note that a "comedy actress" well-known to many and liked by some just sold a high floor loft there for $2.61mm.

That not-so-funny-anymore loft was evidently #9E, in the brand new four steel-and-glass upper floors that cantilever out over the original furniture warehouse lower six floors. Let's look at what the comedian did with #9E.

from 2003 to 2009, up 69%
TRD's Adam Pincus reports that the sponsor sold the "1,836 sq ft" #9E in November 2003 for $1.6mm ($871/ft) -- not much of a premium over Old Loft #3W, which the developer valued at $1,522,284, or $784/ft for "1,942 sq ft", given the "120 sq ft" terrace and the height (and light) advantages of the new 9th floor. That puts the #9E seller up seven figures in six years, or nearly 70%, before considering round trip expenses. Happy math, that!

Of course, as even sellers with no sense of humor are wont to do, the comedian wanted happier math, having started to market in March at $3.25mm (we'll come back to that number, so make note). Proving to be a serious seller, they dropped the price a healthy 8% within four weeks ($2.995mm) and again by 5% six weeks later ($2.85mm). They were in contract from there within another 6 weeks, so were on the market just over 4 months before contract. That contract negotiation was, of course, serious, and chopped another 8% off the last asking price, or a total of 18% off the original March asking price to close at $2.61mm.

the neighbors did better last year (of course)
As with the Porter House sale I hit on August 16, this sale has a lovely comp with which to asses the change in The Market pre- and post-Lehman. In that case it was #4W selling on July 3, 2008 at $2,787,500, compared to #3W selling on June 23, 2009 at $2.15mm. In this case, the very recent #9E sale at $2.61mm compares with the July 1, 2008 of #8E for $3.1mm (raise your hand if you remember the original asking price for #9E). Pretty strong evidence that the value of #9E declined by about 16% in a year.

Those downstairs neighbors had an interesting listing history, as well (is there such a thing as Listing History Porn??). They over-shot the market (an endemic situation), but recovered to generate a bidding war. Check this out:
 

This history is interesting because they were on the market at The Top, without getting their price (or any price) for five months, and then they got someone to pay $100k over a two-month-old asking price. Also interesting that they did not generate a contract at the April 2008 contract price of $3.1mm when they were asking (only) $3.3mm from November to January. If that eventual buyer was looking in November, you'd think that buyer would have bid to a $3.1mm contract then. Perhaps the buyer did not emerge until later; perhaps the seller was not willing to compromise (yet).

further shameless speculation
If there was a bidding war in April 2008 for #8E, as this history suggests, I wonder if the losing bidder bought something else then or ... perhaps that bidder came back to snap up #9E a year later, "saving" almost $500k.....

It is much less speculative to believe that the comedian was distracted (mistaken) by starting in March 2009 above where #8E had closed 9 months earlier, as the facts proved that no one stepped up with an acceptable offer off of $3.25mm. By April, even asking $105k less than #8E's clearing price generated an offer. Still, the comedian sold 69% above her November 2003 purchase price, so she should be smiling even if she left 16% of notional dollars on the table.
 

(h/t to Curbed for the TRD link)

Aug. 27, 2009 - revisiting Trouble in Tribeca, while stopping in Soho

a promise, kept (rare!)
When I hit the Manhattan loft #3S at 155 Franklin Street (the Sugar Loaf) as a June 2009 sale 16% off the 2006 clearing price (August 5, 155 Franklin Street crashes past 2006 to close up 28% (since 2000)) I made a note-to-self to revisit The Real Deal July 31 article Trouble in Tribeca that noted that this was one of only five lofts in Tribeca that closed in June. So let's go visiting....

tweaking TRD data
The article relied on data from StreetEasy and OLR and noted that "[t]he number of closings may not be completely inclusive because there is sometimes a lag period when closings are reported". In fact, one of the 5 "June" closings they cite was a deed dated May 29 (#19A at 270 Broadway), and there were 3 other Tribeca loft closings in June that they did not catch for this July 31 article: 161 Hudson Street #2B, which closed on June 30 at $2.41mm;  28 Laight Street #1 [Cobblestone Loft], which closed on June 24 at $2.845mm; and 100 Reade Street #5A, which closed for $1.545mm on June 23. (You can find these closings on the handy dandy spreadsheet of Manhattan loft closings that I posted about on August 23, which can be found in the cloud here.)

These adjustments hardly change the overall tenor of the article: there was much less sales activity in Tribeca in June 2009 compared to June 2008.

I don't personally have enough comparative data to fully explore Tribeca sales trends (come back to the spreadsheet in a year or two ;-), but two thoughts in the real Deal article about Tribeca make sense:
 

Although I am not quite sure if that first factor is meant to address employment prospects (are there more Wall Streeters worried about their job prospects in Tribeca than elsewhere?) or general wealth (did rich people take a bigger hit in the recession?), both factors would seem to disproportionately impact Tribeca because not only does Tribeca have very many very expensive lofts but it has very few relatively inexpensive lofts. This is one highly concentrated pocket of real estate wealth.

June was actually a bigger month for Tribeca closings than July. I count (only) another 5 Tribeca loft closings in July (see the spreadsheet) and (so far) only 3 in August.

whither Soho?
While Soho has a broader range of property values than Tribeca, the wealth-and-jumbo factors should also apply there. I count 3 Soho loft closings in June, 9 in July, and (so far) 4 in August.
 

(The two at 459 West Broadway were actually by a single seller to a single buyer.) Still not enough here to draw solid conclusions, other than to note that Soho ain't cheap (though it does have a few more [relatively] low-end sales) and to wonder why does everyone want to live on Greene Street during a recession?
 

Aug. 13, 2009 - 170 Fifth Avenue closes AT 2007 (maybe)

isn't that cool?
There have been a series of Manhattan Loft Guy posts of late comparing 2009 clearing prices to 2005, or other prior sales. (This July 29 post canvassed quite a few, attack of the Killer Comp (when 2005 pricing does not help), and I have added several since then.) Generally speaking, 2009 has not done very well in this competition, so I was a little surprised to see a recent sale in which 2009 may have held its own against 2007.

Aug. 12, 2009 - another big developer haircut as 246 West 17 Street closes at 25% discount (again)

cutting to deal
I hit some new developments that closed after significant discounts from their last asking prices on June 20 (developer haircuts at 15 East 26 Street, 333 West 14 Street, 50 West 15 Street + 246 West 17 Street) and on July 6 (last sponsor sale at 59 John Street / folding tent + closing wallet). When I saw a recent closing in another new loft development, I checked the numbers. Sure enough, there seems to be only one unit left in this 30 story development, with 2 in contract. The barber has been working hard here, for months.

The new development at 246 West 17 St poses a bit of a description conundrum for true Manhattan loft snobs, as it is both a conversion of a 3-story loft building into true "lofts" and the addition of 7 floors of ("loft-like") new construction on top of that 80 year old base. The developers were actually remarkably sensitive to this issue, as the building was (awkwardly) marketed as "Apartments and Lofts".

real loft, apartment plan
The unit that just sold (#2E) is in that base, so truly a "loft" (for those of you who care about such things). This "1,488 sq ft" loft has 12 foot ceilings but a very apartment-like layout. It was first offered in February 2008 at $1.825mm, where it sat for nearly a year. One price drop in January brought it to $1.645mm but the drop in May to $1.595mm did the trick: a contract was signed by July 1. That deal closed on July 20 at $1.2mm, a cool 25% off the last asking price and a full third off the original February 2008 price.

hard working barber
The StreetEasy page for this building shows four closings between February and June at discounts from last asking prices from 20.4% to 27.5%, so there is nothing unusual about the #2E discount on July 20. Two other sales around Memorial Day require a little clicking to see the discounts. The combination of #7A-8B* (huh??) closed on May 26 at $4mm; the units had been last offered individually at $$1.55mm and $3.25mm, so that's a 20% discount. #1C closed on June 4 at $1.35mm, which looks like only a small discount from the asking price of $1.375mm, but that was sufficiently anomalous to click through and see that the last rel price change for #1C was to $1.995mm on May 13 and that the "$1.375mm" price was adjusted on June 5 (the day after the closing) -- clearly some kind of mistake. From $1.995mm to closing at $1.3mm was a 35% discount.

A busy barber, indeed.

The first closings in this development were in September 2008 and show some discounts even then -- just from higher numbers and net-net nothing like the 2009 final sales.

COUNTDOWN: 10 ...


© Sandy Mattingly 2009

Aug. 9, 2009 - 2005 + 10%? that might work

There's a lovely square loft newly available for sale in a prime Manhattan loft area that is asking about 10% more than the clearing price when it sold in June 2005. I think this is likely to be close enough that The Marketwill reward it with an offer off of this asking price.

square can be a problem
That square layout would be ideal if it had more than one exposure; as it is, it is somewhat challenging. It is big enough for several bedrooms, but as configured this one has a master "bedroom" with no windows (one very clever picture might lead you to overlook that detail until you were in the space). The layout challenge is compounded by the fact that all the plumbing is on the wall opposite the windows (this building has two lofts per floor, one in front, one in back, with all the plumbing running only up the center of the building). Thus, the master "bedroom" has a nearby bathroom en suite, but other lofts on this side of the building have a real master bedroom (with window) and en suite bath because they add a long closet, sitting room or dressing room between the bedroom and master bath.

The listing suggests that these lofts don't come to market very often, which is odd because this very loft sold in 2005 and more odd still because one in the same line sold this past Fall (after Lehman, but with a pre-Lehman contract). That loft seems to have been in similar condition to the new-to-market loft and fought The Market down from Spring to Fall, closing very close to the current asking price. If that loft and this one are sufficiently comparable (as appears to me), I'd expect this one to close at a discount to that one's October clearing price -- but a discount within the range of reasonablenegotiation.

I will keep it on my list, and hope to report that it traded without a dramatic price drop. Time, as always, tells; Manhattan Loft Guy just reports.

Jul. 29, 2009 - attack of the Killer Comp (when 2005 pricing does not help)

tough to price, if even 2005 is too high
There's a pretty big Manhattan loft in a Chelsea corner that has been patient at an asking price around $1,100/ft for 3 months, which is just slightly less than the loft sold for in 2005. Ouch. It is a lovely loft, full of mints and proper proper names, with sunlight and tin, plus columns and huge windows. Priced by these sellers under what they paid 4 years ago, you'd think that it is priced where it should generate an offer. (Well, I would think so. And these sellers and at least one experienced agent would think so.)

modesty, not rewarded (if 2005 = modesty)
Indeed, I would generally have said that pricing a loft at or below 2005 prices was a sign of modesty, an effort that should be rewarded. When I first noted the listing (with all the breathless mint discussion) and the 2005 prior sale, I assumed that the renovation had been done after 2005 but it turns out they are not that modest. But still....

My attitude about 2005 is evident from my post on July 22 about two lofts at 29 East 22 Street, one of which sold recently and the other in 2005, 29 East 22 Street closes but is the calendar off?, where I yelped
 

back to 2005

Turns out that my memory is not that good, as I have hit on on a significant number of recent Manhattan loft sales around 2005 prices (though only one of which took more than the 16% hit at 29 East 22 Street):

• 14% off, July 11, in 50 Warren Street closes, off 45% from original ask + 14% off 2005 price
• July 3, 2005 pricing at The Printing House, 421 Hudson Street
• 7% below a 2005 sale, June 26, 73 Worth Street closes by biting a very large bullet in one bite
• $35,000 off 2005, June 3, 4 months to close, 4 years to zero out at 260 West Broadway
• plus (only) $15,000 compared to 2005, May 27,  4 years = $15,000 at 477 Broome Street
• 20% hit in the "C" line at The Bullmoose, May 15,  into the way-back machine to close at 42 East 20 Street, down seven figures
• an asking price within 7% of the 2005 sale of the same loft, March 27, more angst at $1,000/ft / feels like 2005 in Tribeca as contract (finally) signed
• when I riffed on the changing market on March 4, the post was titled worse than bandages? painful for sellers to rip the calendar, but the first headline was: "2009 as the new 2005, without the optimism"
• and (finally) my February 27 title pretty much says it all, as far as 2009 vs. 2005 goes: 2005 wasn't bad, was it?

Note to self: stop being surprised by 2005 comps.

hate the neighbors?

But I want to make a different point than modesty about the loft that launched me on the trip back to 2005. The most painful thing for these sellers is probably the dread of the impact on their value done by a very recent sale of a loft of the same size that needed a complete make-over. That loft was in contract when this one started to market, after having been on for very long, with large price drops. That buy-and-gut loft closed $500/ft less than the current ask for this oh-so-minty loft in the same building. Granted, there are relatively few buyers for a very large total renovation project in the current (thin) market, but that spread has to be awfully worrisome to the minty sellers. One could probably do a $300/ft renovation in the recent sale, and still have a loft that is comparable at less of an investment than the current minty sellers are asking a buyer to make.

That makes marketing this loft very difficult, despite their pre-2005 pricing. What can you do?

If you believe that the $622/ft buy-and-gut clearing price was the aberration, you make that argument to buyers (if anyone shows up to view) directly and hold your price. (After all, you are still priced below 2005.) If you can afford to sit for a while, you might take it off the market (3 months? more??) to see if The Market re-sets in a way that you can more easily distinguish a May 2009 (possible distress) comp. If you can't afford to sit, and you can't attract a bid, maybe you wait until Labor Day (blaming the traditional lack of high-end buyers in summer) but you have to drop your price. Pain ensues, yes, but also (perhaps) a sale. As I said in the March 4 title, it is "painful for sellers to rip the calendar", perhaps "worse than bandages?"

Lovely loft, though. Very minty. And large.

Jul. 22, 2009 - 29 East 22 Street closes but is the calendar off?

Jul. 20, 2009 - down a million bucks, now pitching at a pre-2005 $625/ftaa

a little limbo action?
There's a rather large Manhattan loft for sale at a new price that is $1mm less than the original asking price. When it came to market last Summer (happy birthday wishes are now in order) a smaller loft in the building had just cleared at about $850/ft. That one had been completely re-done; the market survivor has some restored classic loft features and (the obligatory) chef's kitchen, but may not be quite up to the level of finishes of the one that sold 15 months ago.

The survivor has now had 4 price drops, the last (and smallest) coming after it took a few months off the market. Consistent with the overall size, the master suite is massive, while the 2d bedroom is equal to many "apartment" masters. The layout strikes me as a bit odd, as if adapted over time to changing needs. (The "dining room" is curiously remote from the kitchen, for example.)

I have a hunch that many potential buyers see a need to remodel, hence the market resistance leading to four price drops totalling seven figures, and a current ask of $625/ft. That $625/ft is lower than the price-per-foot of the only two lofts in this building that sold in 2005.

blame it on the neighbors (wrong, but feels good?)
Sellers must be frustrated. In the cold light of retrospect, they wasted a Summer, then a Fall, then a Winter at a series of wrong prices. (Perhaps they were distracted by the neighbors getting out at $850/ft just before they started their marketing journey ....) There may be more activity in the current market than during the First Quarter, but I don't see the latest 4% price drop materially changing anyone's approach to this listing. Tick, tick, tick ...

© Sandy Mattingly 2009

Jul. 14, 2009 - more computation challenges: asking $1,100+/ft after next door sells under $900/ft

metaphysics 101: possible, yes (isn't everything?) but likely, not so much
There's a Manhattan loft new to market in an up-and-coming loft nabe (at least Manhattan Loft Guy thinks so). Lovely space; lovely views. Problem is that it features been-there-done-that (didn't work) pricing, implying that there was a ... discussion ... between agent and seller that included the we-can-always-reduce-the-price card being played by the seller.

Like the neighbor next door, this loft has a roomy 2 bedroom layout. I can't tell (yet) if the build-out is quite to the level of the one next door, but let's assume it is equivalent in quality. The one next door had a lot of trouble selling, needing 12 months, 2 firms and 5 prices to sell under $900/ft. You'd think that rather current experience would set The Market; at least I would think that. One faces north, one south, so maybe there's a smidge of premium for a better view in one.

is that a limb I climbed out on?
Maybe they don't have to sell. Maybe they really want to sell but want to give it a shot.

I will be shocked if the new one clears anywhere near $1,000/ft.

Jul. 13, 2009 - does not compute / 2007 + 10% = no sale?

will aggression be rewarded? (you can guess)
A not-quite-recent new listing of a Manhattan loft caught my eye because it is in a building in which i have recently looked at a recent sale compared to past sales, and found a 2009 clearing price that approximated an old clearing price. Based on the opening ask, the seller of the new one must not be a Manhattan Loft Guy fan....

The almost-new-to-market loft was bought brand spanking new three years ago at $800k (it is not a large loft, obviously). That first buyer immediately tried to flip, without success, looking for 30% more than s/he had paid. It took about a year, and asking prices bouncing up and down, before it sold for just under a million -- a 23% return before expenses.

flipping The Market a bird (or trying to)
It is that Spring 2007 buyer who is now trying to sell, originally at a 10% premium. More precisely, that Spring 2007 is offering the loft for sale. Maybe the spread is not so great that it will prevent an offer (emphasis on maybe), but asking 10% more than the 2007 price is a tad ... aggressive.

Jul. 8, 2009 - will pricing 25% below 2007 hit The Market in a sweet spot?

will a modest asking price be rewarded?
There's a lovely Manhattan loft newly offered for sale at about 15% above where it was bought brand new 4+ years ago. Why do I think this is a modest asking price? Neighbors downstairs sold their (identical) loft in 2007 about 25% above the new asking price. Those downstairs neighbors generated a gross gain of 50% over their 2005 purchase price. At 2007-less-25% pricing, the new listing seems modest, indeed.

Whether it works or not is a different story, of course. But they are helped by the fact that an upstairs neighbor has been stubborn, and offering another (essentially identical) loft at more than 20% above the new asking price, without generating a contract in the 8 months that has been offered. They may also be helped by the fact that other upstairs neighbors dipped their toes in the market waters for a few months, and pulled off when a price about 15% above the new asking price did not work.

the roller coaster of brand name loft conversions in nabes that are tres fasconable
This loft was newly converted at pretty much exactly the right time, from a developer's point of view. Closings started in early 2005. The very first buyer flipped after 7 months -- at a 60% premium over the original price. Another early buyer was quicker (flipped within 10 weeks) and not quite as successful ('only' a 50% premium). Weren't those exciting times??

There was an active after-market in this building, with widely variable results. Sales in 2006 and 2007 by original purchasers garnered premiums as low as 20% and as high as 70% above the sponsor prices. But evidence of a change in The Market occurred here as early as January 2008, when a loft that had been flipped by the original buyer within that first year (2005) at a 40% premium traded again in January 2008 at about 6% above the purchase price 26 months earlier.

All said and done, it will be "interesting" indeed, to see where the new one ends up -- and whether the current modesty matches the current market. At a minimum, they are ignoring much of the background noise of the intervening roller coaster years. Props to them for that.

 

Jul. 7, 2009 - shorn but sold at 109 Greene Street

doing what you have to do
The Manhattan loft #2B at 109 Greene Street has sold three times since it was brand spanking new in 2005. This is going to get bumpy, but let's get out some facts (closing dates and clearing prices), then chew:

facts, just facts, Ma'am
More factual material: from the most recent listing, the "1,808 sq ft" loft has a classic Long-and-Narrow floor plan, with windows only front and back, but with the proportions for the rooms you are only ever far from a window in the bathrooms (the floor plan is easier to see from the StreetEasy listing page, here). The list of kitchen appliances is one proper proper name after another, with one jaw-dropping kitchen amenity: a sushi bar. The large windows and 13-and-a-half foot ceilings provide serious loft cred.

I did not know that (or I forgot)
[update 7.8.09: I am scratching my head this morning as the building info that follows seems to be for the WRONG condo. I have crossed it out as I don't have time now to figure out how I got to the development website for Lofts on Greene for this address, as there is (still) a (different) condo at 103 Greene Street, The Milan. The info about the individual loft sales seems to be good, but my building info is .... garbled. I will try to figure out later ...]
(If I knew this back in 2005, I have forgotten that I knew it....) According to the development's website (still active!), this condo is a hybrid of conversion of one commercial loft building from 1879 (f/k/a 103 Greene St) and the combination with a new building to replace the twin of 103 (101 was destroyed in a 1950 fire) by, among other things, using a mold of the 103 facade to cast (in iron!) the facade of 101's replacement. That is so cool that I am pretty sure I would remember it today if I had been aware of it then.

The website says 12 units were to be offered, including penthouses, but I count 13 units sold in quick order, 11 in May 2005 and 2 penthouses in June 2005 (StreetEasy is my friend, and yours). How well-received were The Lofts on Greene? They were so well received (and thanks for asking) that #5B was flipped on September 14, 2005 for $525k more than the original price of $2mm paid on May 16, 2005.

not messing around
This recent sale of #2B was quick, if painful: new to market on February 6 at $2.8mm (note the price these sellers paid in July 2006) with one trivial price drop (to $2.75mm, a mere 2% at this level) on April 12 that must have lead immediately (somehow) to a negotiation, as they were in contract as of April 28 -- $435k from where they'd started in February (a healthy 15.5% off). They assuredly did not like it (note again the price these sellers paid in July 2006), but they did what they had to do in this environment to actually sell.

other flips worked better
You'd guess that the three-part price history of #2B is a simple function of The Market (at any given time) being The Market (at any given time). But the experience of the upstairs neighbors in #4B has been quite different: that unit was bought in the initial offering in May 2005 at $2.5mm (it is "2,448 sq ft" -- fully one-third bigger than #2B) and then flipped almost exactly four years later for $3.695mm. That sale overlapped substantially with #2B; it even took a bit longer. #4B was offered on December 18 at $4.25mm, dropped (ever so slightly) into the 3s on March 31 ($3.995mm) and entered contract just days before #2B did, at only an 8% discount from last ask and a 48% premium over the 2005 purchase.

victors, meet spoils
All that gain went to the #4B sellers, as they had been the original buyers; in contrast the recent #2B sellers sold at a loss compared to their 2006 purchase (they were down $345k, before expenses). The still puzzling comparison between #2B and #4B is from May 2005 to 2009: #4B gained 48% when it sold in May 2009; #2B gained only 25% from May 2005 to June 2009. Weird.

#5A has a flipping history (so to speak) that ends just before Lehman hit the fan. #5A sold on August 25, 2008 for $2.875mm, after being bought in the initial offering in May 2005 at $1.81mm -- a flipping gain of 59% in 39 months. Also weird, compared to #2B, but less weird than the #4B comparison to #2B because the #4B sale in May 2009 was well into The Changing Market. Other flips were earlier, and showed smaller gains than #5A and #4B.

#3B has also flipped once. #3B is "2,469 sq ft" (almost-but-not-quite the same size as #4B) and sold in May 2005 for $2.9mm and then in December 2007 (near The Peak, no?) for $3.65mm. That's only a gain of 26%, before expenses.

One more flip: PHB was originally $3mm in June 2005 and sold for $3.835mm in February 2007 -- a 28% gain, before expenses.

using closing dates, not contract dates can be confusing
I can't see contract dates for the initial offering sales, but it is possible that there is a significant spread between the dates the first initial contracts were signed, and that some of the gain for #4B is the result of an early (pre-price-raising amendments?) contract, compared to other units that have since flipped at lesser gains. That's just speculation, of course, but that #4B gain of 48% in May 2009 sticks out even more than the gain of 59% for #5A cashed in in August 2008.

another "explanation"?
Or this history and set of comparisons (terribly convoluted, I know, but it just grew on me like Topsy) can be "explained" by a not-so-simple aphorism: The Market is not always efficient. Certainly, I can't find any efficiency in this messy set of data.

 

Jul. 6, 2009 - last sponsor sale at 59 John Street / folding tent + closing wallet

the price of a  bath?
The Manhattan loft in the new development (well, it was new in 2007) Five Nine John Lofts, #PH2 at 59 John Street, closed on June 24 at the recently public price of $1.35mm. Billed as the "last sponsor unit", this "1,612 sq ft" loft (with "1,592 sq ft" wrap terrace) had been offered for sale originally in 2005 (well before the Andres Escobar conversion was completed), asking $2.55mm, so this is quite the come-down. (The last of seven price changes in the 3.5 years it took to get to contract was to $1.575mm, so the developer took another 14% off that much-reduced price to wash his hands of the project.)

Jul. 3, 2009 - 2005 pricing at The Printing House, 421 Hudson Street

one-third of the way from February 2005 to June 2006 = about July 2005
The Manhattan loft #709 at 421 Hudson Street cleared at $1.64mm on May 29, 2009. They wanted more, of course, having started at $1.995mm in October 2008. But they ended up at a price from about the middle of 2005.

If the value of #709 could be plotted on a graph as a straight line, the May 2009 price of $1.64mm would be about July 2005, based on these data points (clearing prices):

February 2005 $1.6mm
June 2006 $1.715mm

This "1,500 sq ft" duplex loft features a "tastefully renovated" chef's kitchen (Carrara + stainless), a double height living room, and "breathtaking" views. The sellers thought it was worth more than they had paid for it in June 2006, so they brought it to market in October 2008 at $1.995mm. Two quick (small) price drops (to $1.895mm) were followed by 3 months of public stubbornness (no change in asking price), but secret flexibility: when they struck a deal in February they negotiated to $1.64mm, a decent 13% off the asking price. Props to them (and their agent, Richard Orenstein of Halstead) for recognizing that they should take what The Market was offering.

quiet competition, envy
The #709 sellers may or may not have known that their neighbors in #706 were also interested in selling. There is no listing associated with the April 1 sale of #706, but it sold to the owners of #505 for $1.73mm. These buyers seem to have held on to #505 as well, which is kind of interesting. They obviously can't combine #505 and #706, so one wonders how that private deal was struck. City records show #706 as "1,279 sq ft", so that is a significant per-foot premium over #709 ($1,352/ft vs. $1,093/ft). Without a listing to refer to, I have no way of knowing the condition of #706, or whether it was finished to that much higher a level than #709.

Interesting also that #709 was sold to someone in the building. The people who bought #709 on May 29 sold the smaller #604 ("912 sq ft") on May 28 for $1.025mm. If I am reading the respective histories on StreetEasy correctly, the #604 sellers signed a contract to buy #709 before they signed to sell #604. That's brassy.

The #614 trading price of $1,123/ft suggests that the private sale of #706 is the outlier price of 2009 in this building, rather than the #709 price. The #706 buyers (who were and remain #505 owners) must have really wanted that loft.

another battle of 2005 vs. 2009, with 2005 winning BIG (if a fair fight)
All this detail got me looking at other clearing prices at the Printing House, so I found one more loft that has changed hands twice since 2005. Assuming that both sides were arm's length transactions (I will explain in a moment), #603 traded in September 2005 at $1.625mm and again on July 17, 2008 at $1.45mm. There are no listings in StreetEasy associated with either of these sales, and the sale last year was to an LLC, so it may not have been arm's length; if it was, that unit dropped in value by about 11% in 3 years, pre-Lehman. (No idea of size or condition.)
 

Jul. 2, 2009 - when charm is not enough, cut and cut again

There's a lovely (truly charming) Manhattan loft for sale that has had rather a lot of trouble finding it's correct positioning in The Market. I'd say not for lack of trying, as it has been on the market (on, and off, and on, and ...) for the better part of three years, except that it seems to have been so far from market price time and time again. One suspects that the sellers are more in love with the lovely (truly charming) loft than any buyers. That can be a problem.

Jun. 30, 2009 - The Memo was delayed? / flipper now under year-old price

Jun. 25, 2009 - why would you do that? flipping (trying) at 25% over February 2009

head-scratching ensues
There's a Manhattan loft new to market in a building that has had a fair amount of activity in the past couple of years. One bit of that activity was this very same loft, selling in February for $1.73mm. When that happened, the loft was a poster child for the changing market -- coming to market at $2.275mm at the peak, then hanging on (dripping down; 3 price drops) through the dog days of Lehman, into 2009.

So it is back on the market at ... Old Price #2. The exact price it did not sell at from May to September 2008. $200k higher than the price it did not sell at from September into November. $300k more than the price that generated a sale at $1.73mm. I am scratching so much my head hurts.

Why would you do that???


 

Jun. 20, 2009 - developer haircuts at 15 East 26 Street, 333 West 14 Street, 50 West 15 Street + 246 West 17 Street

taking the money and running
In looking at recent loft sales, I came across these five cases (in four buildings) in which a Manhattan loft developer took a pretty good discount from the last asking price to close a deal. In one case*, it is the first closing in the building; in the others, these are close to the last. Just for fun, I have also included the original asking prices for these lofts.

 

That is a lot of clipping.

Jun. 3, 2009 - at 65 West 13 Street, 3 years = off $20,000, but last year ...?

how they could they not regret?
If you drew a line between the fair market value of the Manhattan loft #8D at 65 West 13 Street (The Greenwich Condominium) from the sale in May 2006 at $2.22mm and the sale in April 2009 at $2.2mm, the line would be essentially straight. But that straight line would hardly accurately reflect the change in values over those three years, as the substantially similar #10D sold for $2.71mm as recently as September 2008 (that unit's line would look very different, as #10D sold in January 2005 at $2.075mm).

The Greenwich Condominium conversion of a former department store in 2000 - 2001 brought a level of luxury and amenities that this micro-nabe had not seen in a loft building before. Concierge services, beautiful roof deck (gas grill!), and real volume in these high-ceilinged spaces. The "D" line overlooks 6th Avenue (high enough on the 8th floor that, with thermopane windows, should reduce most of the ambient noise there to a hum), with very good light and those "city views". This "1,898 sq ft" unit was said to have been newly renovated when it came to market in July 2008 at $3.2mm, almost immediately after their upstairs neighbors in #10D went to contract quickly (4 weeks) off an asking price of $2.95mm (without a new renovation of 7 year old space).

I suspect that the #8D sellers did not view themselves as stretching the market on July 23, 2008.

market trajectory = rapid decline
The #8D sellers assessed the change in market after Lehman's Labor Day fall, and dropped to $2.995mm by late September, and again to $2.85mm in November. Our inter-firm data-base shows this was technically 'off the market' after December and that a contract was signed in March 2009, so maybe they were already negotiating with the eventual buyer in December, or maybe they did a very soft form of marketing in early 2009. Whatever, the March contract resulted in an April 21 closing at $2.2mm -- a rather large discount from the last asking price (23%), a very large discount from their original July 2008 asking price (31%), and what must have been a disappointing essentially flat (gross) 'loss' of $20,000 from their purchase in May 2006 at $2.22mm -- especially in view of #10D's clearing price of $2.71mm in September.

sometimes you just have to sympathize
Even assuming that the newly-renovated #8D and the (probably) 7-year-old-original-condition #10D were truly similar, the change in value between #10D's September 2008 and #8D's April 2009 of 19% is dramatic (more so, if the #8D renovation was significant upgrade). How could they not be thinking 'if only we had gotten our act together 3 months earlier ...' ?

With two units so close together, I can't think of a better (in this case, poignant) illustration of the turn-of-market that occurred with the AIG + Lehman + Associated Fall-out in the Manhattan loft market.
 

May. 14, 2009 - Manhattan overall inventory down March-to-April (slightly)

just a nugget, not a trend (yet?)
The Wall Street Journal's on-line article Tuesday about a national trend in a decline in the number of homes for sale in 29 cities was based on a source that has no Manhattan data, but they seem to have checked in with The Miller: "Miller Samuel Inc., an appraisal firm there, reports there were 10,369 cooperative apartments and condominiums on the market in Manhattan at the end of April. That was down 0.7% from March but up 20% from April 2008."

h/t The Real Deal

a trend?
The Miller himself posted on Curbed last Friday about trends in weekly inventory levels by size of apartment, where the hint is in the title: Listings, They Are A-Stabilizing . Money quote comes with bolding in the original:
 

I don't see how a "seasonal increase in demand" (i.e., more buyers in Spring) translates into stabilizing inventory as early as May, because any March contracts (early Spring buyers) have not closed yet (i.e., are still in inventory). But he's been following this much more closely than I have, for a much longer time.

Note that my weekly count of Manhattan lofts available for sale does not reflect what The Miller sees in the overall Manhattan coop and condo market:

Loft inventory has been in a very narrow range the last seven weeks: from 989 to 1,024. That may be "stabilizing", but it is stabilizing at a record level. Time, as they say, will tell.