Mar. 15, 2007 - Jagger's Law of Imperfect Lofts / life is compromise (sigh)
Mick Jagger was uncharacteristically understated back in the day:
You can’t always get what you want/
but if you try – sometimes /
you just might find /
you get what you need
I don’t think he was singing about Manhattan lofts, or whether he has been a Manhattan loft buyer since 1969. But if he were, he would probably delete the word “always” in the first line quoted above. Which is a roundabout way of saying that all buyers I have ever worked with have had a different Learning Reality Curve than they anticipated.
gotta get those MICKs
All well-prepared buyers have a sense of the market, usually derived from some period of watching listings, focusing on neighborhoods, features and prices they think they prefer. For loft buyers in Manhattan the key variables are often location, size, light and/or views, amenities, level of finishes, and price (not necessarily in that order, of course). You could call these the Most Important Criteria, or MICKs for short.
It is my belief that the way buyers look at listings contributes to Jagger’s Law of Imperfect Lofts. And it is my belief that this Law is valid at any price point -- $3mm buyers are as likely to be as frustrated by Jagger’s Law as $1mm buyers – as no one will get all of their MICKs. (Though they just might find that they get what they need.)
Even sophisticated and knowledgeable buyers need some awkward collisions with the reality of what is actually for sale in order to give up on the mythical perfect loft.
I will illustrate with real buyers who are recently in contract for a loft at a price point that is beyond what a lot of loft buyers are looking to spend. I will keep them anonymous, so they should quibble with me in private emails (if they must) to preserve their anonymity.
This history will take a long while to relate, because I want to be specific (and I am pretty wordy in general). But if you want to skip to the bottom line it is this: buyers need not be picky, cheap or indecisive to fall prey to Jagger’s Law of Imperfect Lofts because all lofts are imperfect.
why imperfect?
Informed and reasonable buyers will see lofts that are at some (or even many) of the right values (the right price, size, location, finishes, light, space, location) but they are simply not going to see a loft that hits on all of those criteria – it’s The Law. Because if a loft has great light, and large space, and high finishes, and good location – compared to other lofts that are candidates – it is going to be priced higher. Usually, priced out of the comfort zone.
Informed and reasonable buyers see lofts they can afford in person or on the web with great light and views; they want that. But they don’t want it in that building, or in that layout, or with those finishes, or at that price. Then they keep that light and views in mind in the mental file labeled What We Like And Can Afford. That is human nature.
Informed and reasonable buyers see lofts they can afford in person or on the web with great space and layout; they want that. Into the file, without the limitations.
Informed and reasonable buyers see lofts they can afford in person or on the web with great baths and kitchen; they want that. Into the file, without the limitations.
Informed and reasonable buyers see lofts they can afford in person or on the web in a great light location; they want that. Into the file, without the limitations.
If you doubt this, follow my buyers….
First off, these buyers have been in Manhattan long enough to know loft neighborhoods (they have lived in several). They were flexible about neighborhoods and significantly more flexible about buying a ‘fixer-upper’ than most loft buyers. And they did not need to have the level of services and amenities in the newer loft developments (i.e., they did not have to have a concierge, or a pool, or a lobby cold room, or a business center). But they wanted “a lot of room” (2,500 sq ft, at the start) and lots of light, and they wanted something that is already (or can be turned into) beautiful space.
They were willing to spend up to $3mm to get it. If you think that someone should be able to find the perfect loft at this price, you are like them. And you will share their frustrations in that search.
the MICKs for these buyers
- space (2,500 sq ft more or less)
- very good light (views would be a plus)
- high level of finishes (or the reduced price to renovate to get it)
- ‘nice’ neighborhood (a slippery concept)
- some loft-y ‘character’
- under $3mm
dollars short, days late (or, too early) at The Capitol
The first loft listing they got serious about was #701 at 236 W 26 St, but it had a layout that would have to be re-figured for them and it was just too early for them to commit to anything that was not ‘perfect’. It was certainly big enough at 2,717 sq ft, had terrific light with huge windows and three exposures (the longest being dazzling south), and it had a high level of finishes throughout. The asking price was in their range at $2.56mm, though maintenance was a bit high for a non-doorman building, at $2,680/mo.
But the loft was set up so beautifully as a one bedroom (a One Bed Wonder!), though with the capacity to be two or three bedrooms without a lot of work (some but not a lot). When we saw it it had been on the market almost two months, without having gotten an offer. While they were considering making the proverbial low-ball offer and discussing between them the pros and cons, the market caught up to them. In a few days, there were multiple offers and the loft seemed destined to go well above the asking price (it hasn’t closed yet). This activity both energized them (“other people like it too”) and enervated them (“we don’t want to get in a bidding war”).
At the end of the day, the space was great, the size was adequate, the light fantastic, the price was do-able, the location was okay (but do-able), the level of finishes was quite high enough and the ‘feel’ was terrific. But there was just a little too much work to be considered quickly and they were not quite ready to make the compromises necessary to act quickly to see if it could be bought within their comfort zone.
They never bid here, but I wish I had a dollar for every time one of them later said to me “if we could only have gotten 26th St….”
OK layouts + light at 15 W 17 St
The floor-through lofts being converted to condominiums at 15 West 17 Street presented at least two possibilities. These Long-and-Narrow layouts had at least a few windows along one long side on the upper floors and the convenience of being so close to Union Square.
The penthouse had the best light (though more sky than ‘views’), a fireplace, an efficient layout (2 bedrooms plus an office or guest sleeping area) and private outdoor space on the roof. The finishes, kitchen and baths were more “okay” (according to their tastes) than ‘wow’, but that was a workable element. At $2.975mm for 2,221 sq ft, this was just within the dollar comfort zone – though they expected to pay less if they were to bid.
The 10th floor unit presented a fascinating set of possibilities. It had nearly as good light as the penthouse just above it and could be sold raw (not just unfinished, but exposed wiring, gouged concrete floors, and plumbing risers without any plumbing raw).
But the light on both 10 and 11 just wasn’t good enough to overcome a merely “okay” layout on 11 or the possibility of creating something wonderful from scratch on 10.
light and more light at The Glass Farmhouse, but remote
I always think of the West 30s for people who say they want light, so I took one of them to see an absolutely remarkable (but odd – there’s always a catch) concrete floor and minimalist look duplex loft at the Glass Farmhouse, unit 9G – 10G at 448 W 37 St (no longer on the market, no web listing to view). Big windows with 13 foot ceilings and three exposures, showcasing the Empire State Building and the Hudson River (how’s this for beautiful marketing: “180 degree views allowing you to watch the sunrise behind the Empire State Building in the morning and set over the Hudson in the evening”), and a well-executed minimalist vibe could have overcome the need to replace the circular stair with a real stair, and the money was again right ($2.495mm for 2,638 sq ft), but it was clear that one of them would never live in that neighborhood. Alas.
views but dark bedrooms on Lafayette, if they’ll sell
The other one and I went to a candidate for gut renovation at 237 Lafayette – a neighborhood they both love. Unit 8W had very good light and big Soho views, but with only one and half exposures, would only make sense if the bedrooms were interior. A major stumbling block, but one that might have been resolved, as the space had sufficient potential otherwise and the neighborhood was prime. Price ($2.575mm for 2,200 sq ft) was high compared to the work to be done, but the real problem was that the “seller” was ambivalent (or worse) about selling (one of those “they don’t really have to sell” nightmares). Indeed, before it was finally crossed of the list, it went off the market.
very promising over Great Jones St, but …
They found “it” at 684 Broadway, Unit 5E, which led to three very frustrating weeks. The unit was a very primitive loft (probably ‘renovated’ last about 25 years ago), so was a good candidate for a gut renovation, and priced accordingly. It has a long run of very cool pivoting windows along Great Jones Street, just about clearing the low rise buildings to the south and giving very good light. With 3,000 sq ft there was quite enough space, with a reasonable asking price of $2.5mm as a place to start negotiating.
The problem was that they would want to put the kitchen on a wall that had no obvious plumbing lines in it, though the agent “believed” that it could be done. Indeed, the agent quoted the managing agent as saying it could definitely be done. But the managing agent could not confirm that when I asked directly.
They bid on the basis of needing a “reasonable assurance” that the kitchen could be moved to that wall and their lawyer commenced due diligence while we attacked the kitchen location problem by getting a plumber to visit and (literally) drill holes in the wall. (The seller was very accommodating, obviously.) The plumbers were unable to be definitive without opening up a much larger part of the wall – despite the fact that two floors below had a kitchen on that wall -- but the buyers were willing to chance it (with a back-up renovation layout in mind) so they signed the contract. At which point the seller got an offer that was sufficiently higher ($195,000) that the buyers withdrew.
At which point we realized that #3E -- the same unit two floors below (with the kitchen in the ‘right’ place) -- was available for sale at $3.1mm. More than they wanted to spend, but possibly 'done'.
Did I mention that nothing is ever perfect? The change in altitude from 5th floor to 3rd eliminated the rooftop views, but not so much light; the original pivot windows on 5 were not available on 3 (but were replaced by quiet City Windows); sellers in #3E put in a sauna (who needs -- or wants to pay for -- a sauna?); the bedroom array was not quite as they would have built it in #5E; and there was some (not-very-usable) essentially dead space. But the owners had done a nice renovation, the kitchen was in the right place, their lawyer had already done the due diligence, and the buyers had already made a certain emotional connection with the building and neighborhood.
Having done the math on what it would have cost to buy and build out #5E, they bid on #3E, prepared to raise. And within a few days were not only out-bid but out bid at a level that did not mesh with their own financial calculations of value.
beautiful in beautiful downtown Soho
The buyers licked their wounds, took their learnings, and went soon afterwards to #4W at 46 Mercer St, a loft they had seen on line but which went off the market, then came back. It is just big enough, with 2,500 sq ft (the 14 ft ceilings help a lot), the Soho location is prime, the kitchen and baths looked plenty good enough on the web, and the asking price of $2.9mm was (barely) within their comfort zone, though reasonable compared to the local market.
They liked it enough to see it three times, and to linger each time. But at the end of the day the lack of light in the bedrooms (in the back) was a deal-killer for these buyers. They could have lived with the somewhat tweak-able kitchen and 2d bath, and they loved the front room with the huge Soho-outside-the-window windows (the fireplace was a nice touch). But they would not compromise on light for the bedrooms in this package. That one is still on the market.
Laight has light, but issues
The 7th floor at 68 Laight St did not suffer from a lack of light in any corner. 2,400 sq ft with four exposures, 14 windows, and 2 skylights full of the some of the best light Tribeca has to offer. Plus, some definitive loft ‘character’ and the possibility of private use of the roof. But the ask was a bit high at $3.075mm; there would be at least some ‘issues’ associated with improving and using the roof; the building is very self-managed; and the purchase cost plus renovation calculation was a little out of whack. They agonized, they dithered. They passed. That one is also still on the market.
is NoMo perfect?
When the asking price for the three week old listing at 20 North Moore St #8E dropped from $3.4mm to $3.2mm I thought it was worth a suggestion. For these buyers, this address is about as good as it gets. The headline of the web description (“breathes with light and clarity”) spoke to these buyers immediately. The finishes suggested by the photos and web copy sounded more than sufficient.
We arrived at 10:50 for a Thursday 11 – 1 open house with both buyers (despite the promise from one of being unavailable due to work pressure). At ‘only’ 2,400 sq ft, it did not quite meet their MICK on space, but the space had enough of the feel of ‘space’ due to the light, windows, and elevation. All other MICKs were hit as well -- except the price was still ‘too high’ for what they wanted to spend.
But that price limitation had been set before they had seen everything in the market that might have fit them. So they made a very strong bid at 4:30 that same afternoon, strong enough to be accepted that evening. Having once been burned by an owner receiving a better offer after they signed the contract, they moved heaven and earth (and lawyers) to sign the contract on Monday. Done deal, awaiting closing.
An almost perfect loft. Sigh.
so what about a $1mm buyer?
If you are still with me yet doubt that buyers at $1mm will have a different experience, I have not made myself clear. Bounce me here, and let’s talk about that.
Jagger’s Law of Imperfect Lofts has not been repealed. No sympathy here.
© Sandy Mattingly 2007
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