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Mar. 20, 2013 - TYAToMLG talking about the huge premium that some people will pay for a view, in this case of Madison Square


hitting it out of the ballpark
As on Monday (March 18, OYAToMLG talking about post-Peak and square floor plans at 161 Hudson Street) this will be a relatively short post based on the Manhattan Loft Guy archives, due to the conflicts for time and attention presented this first-time visitor to New Orleans. The topic is views, and the learning is that in some instances any effort at applying norms to determine in advance the market value of a view is simply doomed. The data point is the difference in price paid for loft in #14A at 15 East 26 Street (15 Madison Square North) compared to loft #14F down the hall. I will eliminate any suspense and tell you that these essentially identical-except-for-view neighbors sold with a 75% premium for the view ($2.014mm), before going back to show you that this premium can only have been due to the view of Madison Square.

It was THREE Years Ago Today on Manhattan Loft Guy that I presented my March 20, 2010, a $2 million view on Madison Square? comping at 15 East 26 Street, and (because I love this post so much that I used as a true OYAToMLG before) only a year after hit it again in my March 20, 2011, OYAToMLG / two million dollar Manhattan loft views edition, which worked in a then-current exploration of the same topic in a different neighborhood (March 18, 2011, under $800/ft for brand new Lifesaver lofts at 120 Eleventh Avenue). Look at how good a controlled experiment this was:

as clean a comparison as you are ever going to get

The two units are on the same floor, are essentially equal in size ("2,380 sq ft" vs. "2,390 sq ft", with the "smaller" one being a 2 bedroom / home office / 3 baths vs. 3 bedrooms / 3.5 baths), appear to have identical finishes, and have essentially the same common charges and taxes. The "larger" one has a "full spectrum of sweeping city views", facing north, though with only 3 windows giving that north view
***
the "smaller" one … [has] only 5 windows, ... all large and south-facing, giving "sweeping southern views over Madison Square Park" from both bedrooms and the living room.


These were new development sales, which is often a complicating factor for comps analysis, due to things like different contract dates, the simultaneous availability of multiple similar units, and that the developer may have (in retrospect) under-priced certain units. But in this case the contract were close in time, there were not that many units for sale, and The Market rejected the developer asking prices on both these units as too high. In other words, the developer did not merely set the value by fiat, but had to discover the value.

As you will see, that post was prompted, in part at least, by an inquiry in my office about what agents think a “spectacular” view was worth, and included my unsourced bit of hearsay:

I suspect that this spread is out of guidelines for any appraiser, as I have been told that direct river or park views can add "10+%" in value; I don't know how much range an appraiser would put on that "+".


Again: a willing buyer at 15 East 26 Street paid $4.73mm for a “2,380 sq ft” loft with 2BR + office + 3 baths, while another contemporaneous willing buyer paid ‘only’ $2.69mm for a “2,390 sq ft” loft with 3BR + 3.5 baths, with the only significant difference being the “full spectrum of city views” away from Madison Square at $2.69mm and “sweeping southern views” over the Square at $4.73mm.

In the case of the Eleventh Avenue pair I hit two years ago, the spread was smaller (25%) between one set of “treetop” views and one set of Hudson River views. I will let you click around for details on that.

different perspectives
I have long had in mind a to-be-written post about the difference between how buyers, sellers and agents look at individual Manhattan lofts, compared to how appraisers and macro-market observers look at lofts. (Note to Self ….) On the one hand, it has to do with timing (buyers, sellers and agents are generally looking at individual Manhattan lofts that have not yet sold, while others look at lofts in contract or sold); on the other hand, buyers, sellers and agents often more readily entertain “irrational” possibilities.

I am pretty sure that most rational market fans would reject the #14A / #14F 75% view premium at Madison Square, and would guess they would be at least skeptical of the 25% river / treetop premium on Eleventh Avenue. Too darn bad....

© Sandy Mattingly 2013

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Dec. 3, 2012 - how to value light without also valuing views? The Miller gives it a shot, NY Magazine gives it a forum


another riffing opportunity is born
In the reality-based Manhattan residential real estate world inhabited by The Miller, questions such as “how do you value the difference in light between different units, without considering differences based on view?” have at least the framework for an answer. It seems like Jhoanna Robledo at New York Magazine asked The Miller that question, and she turned his fact-based answer into her piece What’s the Price of Light?, with a great graphic. I will describe his answer as she reported (but, really, just scan her piece) but I first want to point out that what is too easily overlooked in the graphic is that this is a framework not a rule; The Miller makes this a little more explicit in his blog’s link to Robledo + Graphic, Valuing the Light in Your Condo or Co-op.

In this particular unidentified Tribeca condo the only difference in value is said to be that the 4th floor looks at a (presumably, former) warehouse across the street, while the 6th floor clears the warehouse roof while threading the interesting needle of not having a better view; based on (presumably contemporaneous) sales on both of these floors $100,000 apart, The Miller calculates a $10,000 incremental value for the ‘extra’ light in each of the 10 windows. Simple, yet elegant. This is a terrific bit of intelligence, and a significant aid for agents and consumers who like to at least visit the reality-based Manhattan residential real estate world.

Robledo only had so much space, but her suggestion about how to generalize from this framework is, to me, risky. Her middle step in the graphic is to apply this learning to another unit “in that building or nearby” and to use the per-window value to do that. In contrast (or, with more nuance), The Miller blogged (with his bold but my italics for emphasis):

Light is perhaps the most subjective of the view-floor level-light trio but this is the logic our firm has used for years (based on the “paired sales” theory that isn’t very practical in an appraiser’s daily life) but I feel it’s a good starting point, and of course it depends on the nuances of each situation.


In other words, don’t just say each window-with-better-light-but-no-better-view is worth $10,000. The per-window approach raises the difficulty in applying this specific example that other buildings may have much bigger, or smaller, windows. It also ignores the question (asked here, but not directly addressed by The Miller) of whether the better way to look at these 4th and 6th floor comps is as $100,000 worth of better light, or as as 11% premium for light. In a pair of much larger lofts than the “1,000 sq ft” Miller example, but still having ten windows, I bet the difference would turn out to be more like 11% than to $100,000. (But that is my provisional approach subject to testing in the reality-based Manhattan residential real estate world.

how narrow is this slicer?
Without knowing exactly which building is the source for The Miller’s framework (or rubric, like I often say when ADD LINK RIFFING) it is hard to imagine how many other loft buildings present lofts on different floors that differ in light but not in views, or what, exactly, Robledo means in saying that neither the 4th nor 6th floor lofts had “an especially wide vista”. I would think the situation like 4th and 6th floors opposite a 5-story building differing in light but not views is pretty rare. Especially at the scale of 5- and 6-story buildings in Tribeca, the light gets better on each floor going up, until you hit the floor that looks directly across at the opposite top floor, at which point the “view” includes much more sky and much more light, while above that height, you get the same light as the one below but much better views (starting from rooftop / water tower views and running up to iconic views or even water). No one ‘rule’ is going to include precise dollar adjustments.

the more typical scenario
I will be on the lookout f(Yes, that’s a Manhattan Loft Guy note to self ….) I addressed a pair of same building comps that differed by light and water views in my February 4, 2011, these water views from a 505 Greenwich loft are worth $370,000 (really). observing that nearly two years ago in that portion of Lower Soho the same-loft difference between the 7th floor (with very good light, as it happens) and the 12th floor (with that light plus river views) was $370,000, or a premium of 24%.

I have done a whole series on view differences at the Chelsea Mercantile, 252 Seventh Avenue. LINKS  Perhaps those posts can be plumbed to look for differences in light that do not include differences in view, especially with so many Merc lofts having good-light-but-NO-view because they overlook that large courtyard.

I also considered this issue, if obliquely, in my September 25, height matters for 51 Walker Street lofts, even 2 floors. That considered a very clean pair of sales (recent conversion, identical footprints) only two floors apart. The 8th floor unit windows look across at the opposite roof line (see 2nd listing pic here), which includes (per the broker babble but not visible on the angles pictured) the Chrysler Building 3 miles away. That spread of $295,000 (a 15% premium in that case) may very well be close to the better-light-but-not-(much)-better-view in The Miller’s example.

Similarly, I looked at a pair of fairly comparable-except-in-height-and-light in my September 24, for 69 Murray Street loft, The Peak was then, and almost now, with examples from the 2nd floor and the 8th floor on a south Tribeca block. In that case, the difference of $725,000 (a 47% premium!) may have been polluted by the second floor being so close to street level, but that just shows how much harder it is to riff with The Miller about rules than it is about rubrics or frameworks.

And, with no disrespect intended to Ms. Robledo for trying to apply $10,000/window “in that building or nearby”, that September 24 post about the 69 Murray pair also referred to loft very nearby that I hit in my October 20, 2010, interesting price history of 71 Murray Street loft bought by Famous Couple. Different market conditions than when the 69 Murray lofts sold, but this is … er … complicating the riff:

the 10th floor loft at 71 Murray Street has 4 exposures and boasted “dramatic northern city views”, yet it sold closer to the 2nd floor than the 8th floor of 69 Murray Street on a dollar-per-foot basis ($976/ft v. $847/ft v. $1,250/ft)


let’s review

  • fact-based analysis is fun
  • reporter Robledo and The Miller deserve our thanks
  • rubrics are more defensible than rules, even if
  • rubrics have room for nuance

Would that more work from the Manhattan Media Wing of the Real Estate Industrial Complex came from the reality-based world!

© Sandy Mattingly 2012

 

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Jan. 24, 2012 - banging the View Diligence drum (again), for Glass Farmhouse loft views from 448 West 37 Street


once more into the breach
Do you see the light gray band that stretches from 37th Street to 36th Street in the middle of the block between 9th and 10th Avenues on this building map from locating that terrific Manhattan loft building at 448 West 37 Street, the Glass Farmhouse? The 36th Street side lies pretty much in direct line between the Glass Farmhouse and the Empire State Building. (Look at the main listing photo for the August 2011 sale of loft #9D for how nicely framed the ESB can be from here.)  

If the litigious folks at Extell Development have their way (and if they have or can get enough development rights) that view might go away, as The Real Deal reported yesterday that Extell just closed on the purchase of two parking garages and one parking lot, at 430 West 37th Street, 434 West 37th Street and 429 West 36th Street. These sites are just east and just southeast of the Glass Farmhouse.

There is nothing in TRD about potential uses for these sites (hotels seems to be the development of the month idea) and nothing about the scale of development rights that come with (or can be bundled onto) these sites. But if I were a Manhattan loft buyer interested in the relative bargains to be had in the region of the Far West 30s that I long ago dubbed Big Sky Country (as below), or an agent with such clients, I would keep this potential project in mind, to check any view angles before signing any contracts.

Is it just my mind that flits from one set of breaking ‘news’ to another (ADD, anyone?), or is the flurry of recent stories about Manhattan sites being acquired for potential future development a real sign of coming economic recovery? Dunno … but this is a drum I have hit quite a few times in the last few months.

View Diligence should come with the territory
The most recent and most pertinent bang on that drum was in my December 20, 2011, development watch: West 28 Street, between 6th & 7th Avenues, in which the (new) bold should help you get my drift more quickly:

Some stories are perennials. For the Manhattan media wing of the Real Estate Industrial Complex it might be one emerging trend (families move to suburbs for quiet!) or its opposite (families move back to city because suburbs are too quiet!). For someone without a REIC card like Manhattan Loft Guy, it might be new development is new, or developing neighborhoods develop. All of which is a roundabout way of responding to the story reported yesterday in Crain’s (though I saw the version in The Real Deal) that a new hotel might be coming to Chelsea’s (former) Flower District ….


As noted, this issue is coming up a lot lately and, because some Manhattan loft areas are less mature (or protected) than Tribeca or Soho, it often comes up where there are residential lofts. Yesterday it was the high 30s west of 9th Avenue. Above, it was the old flower district, east and 10 blocks south of the Glass Farmhouse.

In my July 28, 2011, NFL guy sells loft at 347 West 39 Street, Observer gets facts wrong (again), it was the northeast views at issue nearby (that post was mostly about bashing The New York Observer for a lack of fact-checking but enough about views in the Glass Farmhouse area [aka Greater Barishnik-ville] that I offered “[t]he problem with the north “views” in this building ... I believe, is that there was a large tower going up; the south views, however, had an angled view of the river”).

Just a little bit farther east, still in the West 30s, I catalogued some classic loft buildings that might have at-risk views over a planned (you guessed it) hotel development in my August 18, much diligence due over planned hotel in West 37 Street. I started that post this way, so I guess I am repeating my self (deal with it!):

Part of the charm of living in loft neighborhoods (in Manhattan and elsewhere), for me and I suspect for many people, is that they may be ‘developing’ neighborhoods, with a certain vitality missing from more staid (mature) residential areas and (often, at least early) a discount from the overall market because the ‘developing’ neighborhood may be a little more gritty than mature residential areas.

Part of the risk of living in loft neighborhoods (in Manhattan and elsewhere) that are ‘developing’ neighborhoods is that they … uhhh … will continue to develop.


if you are buying views, View Vigilance must be a subset of Due Diligence
In terms of process, I referred to the kind of information resources that are available in my October 9, 2011, diligence due + negligence committed as West 15 Street lofts + East 15 Street apartments lose views, which was in response to a

[t]errific piece by VToy in [that same] day’s Sunday real estate section of the New York Times, Is That A Bulldozer I Hear? The subtle take-away is that New York City apartment or loft owners who are concerned about the potential ramifications of development sites nearby should remain vigilant (not just diligent)


Indeed, for the specific view diligence issues on West 15 Street that VToy highlighted in October, I wondered way back in my January 9, 2011, loft that missed The Peak at 30 West 15 Street comes back to sell, modestly but successfully, whether a buyer across the street knew that the view was about to be lost.

Can you count on your attorney (or agent?) if you are a buyer? Maybe, but if it were my money I would keep my eyes and ears open, and figure out how the marshall The Google as my friend. I touched on that process point just a few weeks ago, in my December 28, did your attorney use The Google for due diligence? would help at 150 Nassau Street, about a different kind of diligence issue (repairs and assessments) that might not have been revealed in traditional diligence materials (board minutes and the like).

taking, and giving
With the proliferation of uber-lofts and the continued grinding down the rough edges in many Manhattan loft neighborhoods, there are not as many truly pioneering loft areas in Manhattan as there were (east Bushwick fans, take note!). But as I said above in quoting myself from a month ago: some stories are perennials; two pieces from the Manhattan Loft Guy 2006 archives hammer that home:

My July 11, 2006, Now you see it (and pay for it), now you don’t / what are views worth?, was occasioned by an article in The Real Deal that directly bore on this risky-views-in-developing-nabes issue (hint: “development ... can both destroy views and increase real estate values”). In other words, the thing that ruins your view might also increase the value of your loft and your enjoyment of living there.

My July 31, 2006, More on lofts with views / Big Sky Country in the West 30s, is unusual because it had (a) pictures [there can’t be more than 2 or 3 other Manhattan Loft Guy posts with photos] and (b) made reference to then-active listings (though not identified by name). The point was that there were million dollar views at less than a million bucks in the West 30s (Big Sky Country, ha!) but that the views should not be understood as perpetual: “As grist for a future blog post, a couple of these buildings have nearby development slated which will impact some of the views, but that is for another day….” I did not use the Note to self … reminder way back then, but it is nice to see that (once in a while) I get back to topics noted “for another day”.

Methinks I will be back to this topic again. And again. And ….

© Sandy Mattingly 2012
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Mar. 25, 2011 - about the views from that LaGuardia Place loft that zoomed through the market...


watch out for the Purple People Eaters
I commented on the open eastern views when I hit the Manhattan loft at 542 LaGuardia Place that took 10 days to fins a contract and 7 weeks to close (March 15, 542 LaGuardia Place loft zooms through market, with a very expensive roof deck). I probably should have realized this at the time, but the point that these “unobstructed views into the middle of the super block with NYU housing to the east” are at risk has been brought home this week, when NYU unveiled it latest plans for development.

Of course, these are just plans, that require some government waivers, and the locals are already up in arms. So it may never be done. Curbed had the report with the new plans yesterday, after they visited the NYU ‘open house’ at 532 LaGuardia Place with 3-D mock-ups of the proposal. Suffice it to say that those (now) “unobstructed views to the east” from 542 LaGuardia Place may have to contend with the smaller of the two “boomerang” buildings directly across LaGuardia Place to the east. It is possible that some light and a sliver of view will survive, given the angles, but maybe not. (See the ‘bird’s eye view’ on page 13 of the pdf of the NYU proposal to the Community Board for the easiest-to-read schematic.)

I gather than these boomerang buildings have long been a feature of NYU’s plans, and that the new element from prior plans is that the proposed 40-story hotel+residence on the next block south on LaGuardia Place has been replaced with a shorter tower on Mercer Street and some other ‘bulk’ elsewhere. I assume that the buyers of loft #5B at 542 LaGuardia Place have been on top of this; at least, I hope so.

This Villager article from before the big roll-out walks through the old and new plans, mostly from the perspective of where the open spaces are and would be. For any residents of the block with 542 LaGuardia Place, the good news may be that the boomerang buildings are not in the first phase of construction. Any part of a ‘plan’ that does not start for 15 years is a plan that subsequent events may overtake, I suspect.

My point is that any discussion of views (such as mine about #5B at 542 LaGuardia Place) needs to take into account future development possibilities (recall that I figured that the east-facing roof deck added roughly $725,000 in value to #5B). In the case of NYU and the super-blocks, relevant plans have been under public consideration for some time now. While I overlooked those plans in talking about that loft, no seller or buyer should have. These plans are so massive, so public, and so controversial, not a lot of “diligence” should have been required to ‘discover’ them; for other lofts for which light and views are premium items, the necessary diligence may be more intense but no less important.

© Sandy Mattingly 2011
 

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Mar. 20, 2011 - OYAToMLG / two million dollar Manhattan loft views edition


One Year Ago Today on Manhattan Loft Guy, more views, much money
About a Madison Square view that really really really seems to have been provably worth a great deal of money: a $2 million view on Madison Square? comping at 15 East 26 Street.

I flagged this March 20, 2010 post as a future OYAToMLG (that occasional feature) a few weeks ago, and the timing works out perfectly with my very recent post on the same theme (March 18, under $800/ft for brand new Lifesaver lofts at 120 Eleventh Avenue). As I said a year ago,

Everyone will still have opinions about what a view may be worth, but in this instance this view over Madison Square Park was worth $2,014,000. Indeed, while I believe that few people would estimate a view premium on this scale, facts are facts.


The Market valued this new condo conversion on the edge of Madison Square much more highly than the Lifesaver Lofts on Eleventh Avenue. The spread between values With Park View vs. With ‘City’ View on East 26 Street was $2,023/ft for #14A at 15 Madison Square North vs. #14F at $1,146/ft; a huge spread but from a high base. The spread between River View vs. Treetop View at 120 Eleventh Avenue is (to me) significant (in both absolute and market value terms), but is on a much smaller scale and at a much lower base: $997/ft for #3A vs. $799/ft for #2A.

Interestingly, the developers in both cases started out with the right kind of spread for the Premium View unit, though The Market adjusted all the prices down before the four units closed.

Again from that post a year ago:

I suspect that this spread is out of guidelines for any appraiser, as I have been told that direct river or park views can add "10+%" in value; I don't know how much range an appraiser would put on that "+".


I still think the spread at 120 Eleventh Avenue would give a bank appraiser pause, but that’s not my problem. These market facts are facts.

Next up in this ‘occasional feature’ … a much older [Year] Ago Today on Manhattan Loft Guy. Set your calendars for Tuesday for that one.

© Sandy Mattingly 2011

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Mar. 20, 2010 - a $2 million view on Madison Square? comping at 15 East 26 Street


how much would you pay?
[UPDATE 2.4.11: I looked at this post again for purposes of another ‘view’ post and was embarrassed to see that I never spell-checked this. What a mess! I have made the many corrections (26!!), this time without indicating where there’s been any editing. Embarrassing, indeed.]
A colleague recently canvassed other agents with the question, "what is a spectacular view worth?", to which many people responded with opinions but few with data. Personally, I offered the opinion that some people will willingly overpay for a view, though I also provided some data (see below). Then I came across two of the recent new development sales of Manhattan lofts added to the Master List at 15 East 26 Street (Fifteen Madison Square North). Some people will overpay by a lot  for a view. I have some data.

as clean a comparison as you are ever going to get
The two units are on the same floor, are essentially equal in size ("2,380 sq ft" vs. "2,390 sq ft", with the "smaller" one being a 2 bedroom / home office / 3 baths vs. 3 bedrooms / 3.5 baths), appear to have identical finishes, and have essentially the same common charges and taxes. The "larger" one has a "full spectrum of sweeping city views", facing north, though with only 3 windows giving that north view; the developer priced this loft at $3.6mm.

The developer bet that someone would overpay by a lot for a view: the "smaller" one started at $6.15mm (later was "reduced" to $5.9mm), for no other apparent reason than the view. With only 5 windows, these windows are all large and south-facing, giving "sweeping southern views over Madison Square Park" from both bedrooms and the living room.

The clearing prices (can't you feel the tension mounting?) are contemporaneous: buyers signed a contract on the smaller one on January 5; for the larger one on November 26. In other words, you might never find a pair of sales in which The View is so obviously the only difference. As it happened, the developer got nowhere near the asking price on either unit, but was right about the value of the view. Somebody paid $4.73mm for the view in #14A; somebody else paid $2.69mm for the same amount of space and (only) "sweeping city views" in #14F.

Everyone will still have opinions about what a view may be worth, but in this instance this view over Madison Square Park was worth $2,014,000. Indeed, while I believe that few people would estimate a view premium on this scale, facts are facts.

Look at it another way: the #14A buyers paid a 75% premium over #14F for the view.

I suspect that this spread is out of guidelines for any appraiser, as I have been told that direct river or park views can add "10+%" in value; I don't know how much range an appraiser would put on that "+".

other data pair from Tribeca
The other pair of same building sales that shows a premium for a view is not anywhere as clean an example as with 15 East 26 Street #14A and #14F, as those two lofts vary so much in size. Nonetheless, in the case of 38 Warren Street (Keystone Building) #8A sold in January 2008 at $1,282/ft while #3C sold in February 2008 at $1,016/ft. Given that these are two very different lofts (#8A is "1,248 sq ft" while #3C is "2,815 sq ft") it is hard to say that the 26% price/ft premium for the smaller loft was entirely due to the view. But it is some data. Not as good as the 15 East 26 Street pair, clearly.

Fifteen Madison Square North is my new poster child for the value of a view. I just don't think it will become my benchmark, as I doubt that I would be very quick to apply a 75% premium, despite this evidence.

© Sandy Mattingly 2010

 

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Sep. 24, 2006 - how close is that hotel in the window? Light, lost; lowers lucre

 
More change + less light in Flower District loft = less value
I’ve had my internet eye on a West 28th Street loft for a buyer customer and had a chance to see it at an open house today. 1300 sq ft of “[u]nique loft with beautiful hardwood floors, original tin ceilings, open kitchen, 2 bathrooms, great light” seemed like something to check out, either at its September 14 price of $995k or especially at its September 20 price of $800k (it started in April at $1.195mm).
 
What’s down with that pricing? The listing agent (Paddington Zwigard at Brown Harris) sells a lot of lofts; she knows her stuff.
 
Having seen it “in person” I must say that the loft needs a lot more work than the listing (details here) implies. I knew already that the block is very commercial, with the last vestiges of the wholesale flower businesses on both sides of 28th St, but I was surprised at how worn the hallway was. But a lot of old loft buildings in commercial areas have crummy hallways and busy street scenes.
 
accounting for big dollar reductions
Although the unit needs a lot of work, that’s not the point of this story or the reason for its pricing slide. The unit is in the back of the building, not too far from the back of its 29th St neighbor, with four large windows giving some light from the rear. Four large windows on the east provide most of the light (and all of the “great light” touted in the listing). Today.
 
Seems that there is a 16 story hotel planned for the burned out commercial shell next door. The agent at the open house did not know how close the new hotel would come to the windows in 4D, but expressed the view that “all” eastern light would be lost.
 
Labor Day might not have been happy
That owner and Zwigard must have had a painful heart-to-heart after Labor Day (remember the post about post-Labor Day price drops?). They decided to drop $155k the week after Labor Day, then another $195k a week later. That is serious pain.
 
I will try to figure out when news of the hotel plans got out, but it looks as though the owner or agent discovered that problem this month.
 
test case of 2D with no light
Interesting that the same footprint on the second floor has been for sale since June – without any eastern windows at all. #2D was initially offered at $995k but that post-Labor Day discussion resulted in a drop to $925k. Without any light except from the rear windows, that unit is marketed by Corcoran’s Adam McLaughlin as “a quiet, generous space to create an urban sanctuary”on the second floor in the rear of the building, [with] low light”. Note the white floors, white walls, white ceilings in the listing photos – they know they are dealing with a poorly lighted space.
 
So no surprises about light for anyone visiting 2D. But 4D visitors are in for a big surprise – and an explanation for dramatically dropping dollars.
 
© Sandy Mattingly 2006
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Aug. 17, 2006 - Chuck Close lighting unresolved stay tuned

 
That fascinating issue about whether a developer would get a variance to block the light of Noho artists’ studios (including that of Chuck Close) will continue for another month, and may be heading towards a negotiated resolution. I blogged about it in July; here’s an update.
 
Big artist calls out big art’s big guns
The Zoning Committee of Community Board 2 hearing that was to consider the variance application in mid-August has been adjourned while the developer talks to the artists whose light is at stake. Once again The Villager has the story.
 
Not surprisingly, the case attracted major interest in the art world, and The Villager describes two letters sent to government officials, one from Glenn D. Lowry, the Museum of Modern Art’s director, and one from Nan Rosenthal, a curator in the Metropolitan Museum of Art’s Department of 19-century, Modern and Contemporary Art.
 
The letters emphasize the importance of Close’s work, as you would expect from their sources. From a public policy perspective, however, I hope there will be commentary about whether and under what circumstances an “artist’s easement for light” should be required, or purchased.
 
Lowry wrote
“I understand the need for development. I also believe that a balance should be found between new construction and the protection of artists whose work has helped define a neighborhood and, in fact, our city. I would urge the Board of Standards and Appeals to carefully review the plans of the proposed project to insure that the building does not adversely affect Mr. Close’s working environment. Mr. Close is one of the United States’ leading artists and has long been an advocate of New York City’s importance as the cultural capital of the country,” Lowry wrote.
Ms. Rosenthal took the same tack:
“The project will block light from artists’ studios of long standing at 20 Bond St., including that of Chuck Close, the United States’ most brilliant colorist”. “Light is essential to Close’s work. Without it, Close will be forced to leave the building and Noho for brighter space, very likely moving his studio out of the city.”
Close is not just an extraordinary painter and printmaker, he is also ‘Mr. Art World.’…. Close is handicapped (he had a spinal aneurysm in 1989 and is confined to a wheelchair) and having a studio where he can move his canvases easily from ground floor to basement mechanically — and still have light — is crucial.
“Please ask the developers to select a different plan,” Rosenthal urged.
Not surprisingly, the chair of CB2’s Zoning Community was impressed by the letters.
“Obviously, he’s a big shot because you get letters from two major museums about him specifically,” she noted. “It’s not just some little art gallery in the Village.”
 
Nothing against Chuck Close, but I wonder what would have happened if the developer had not needed a variance to build something that would block light from the 20 Bond Street artists. But for the variance request, the City would have nothing to say about the plans.
 
Like views, all light is provisional in Manhattan
While I don’t know this for sure, it appears that this is a situation of someone taking for granted the “fact” that they would always have light, because they “always” had. Presumably, Close and friends would have had the opportunity to offer cash to the owners of the undeveloped lot in order to protect “their” light, but they probably figured that they did not have to.
 
This is a situation similar to the folks at Lincoln Towers who had terrific Hudson River views (see the blog entry that got me started on Mr. Close’s situation), looking over rail yards that could “never” be developed – until The Donald did.
 
Stay tuned until late September.
 
Is your light at risk?
In the meantime, if you really need the light you currently enjoy in your loft, maybe you should research the development possibilities between you and the sun.
 
© Sandy Mattingly 2006
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Jul. 30, 2006 - More on lofts with views / Big Sky Country in the West 30s

 
LOTS of light near the Lincoln Tunnel
I went to a broker open house tour last week, which featured some beautiful lofts from 36th to 39th Streets between 8th and 10th Avenues. For purposes of this quick post, I only want to highlight how much sky (some with terrific views) is available to lofts in this not-yet-fashionable loft neighborhood.
 
Note that the two interior photos below do not feature well just how open the views are (a mistake by the listing agents, IMO). As I told the broker on one of these listings, that neighborhood features many lofts with views that are elsewhere available  only for another million (or two) dollars.







As grist for a future blog post, a couple of these buildings have nearby development slated which will impact some of the views, but that is for another day….

 
© Sandy Mattingly 2006
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Jul. 18, 2006 - light more precious than views to an artist / more on losing views...

 
More than a river view or an Empire State Building-centered panorama, artist Chuck Close will miss his light, if a proposed NoHo development occurs, putting a unique spin on he question about the value of “views” I addressed last week.
 
Chuck Close depends on his north light
Lincoln Anderson in The Villager reports that Close’s Bond Street ground floor studio is in jeopardy if a Lafayette Street condominium is permitted to fill in a small space next to his studio. The proposed development would be a 7-story condo on Lafayette.
 
The main part of development would be ten to twenty feet from his studio, which would limit the north light in the studio. But a small portion (apparently a single story) would fill in the lot adjoining the studio, which varies from six to ten feet wide, and which would be flush against Close’s west wall, covering his windows on that side.
 
The developer needs a variance for any residential construction, so Close and other artists in the same building (as well as those nearby who are sympathetic) have the opportunity to marshal public opinion.
 
AIR at issue, but even AIR use could be fatal to the north light
One issue is the Artists In Residence restrictions still in pace on residential buildings in SoHo and Noho (which I would have said are all but dead, before seeing this article and City Council Member Gerson’s concerns about AIR remaining viable), but the more interesting issue (to me, and perhaps to Close) is the possibility of any new building eating his light.
 
The article explains why this studio is so important to Close. The ground floor location suits his wheel chair, he can bring canvases up from the basement through a slit in the floor and a pneumatic lift, and the main north light (supplemented by his two western windows) comes in through skylights (he paints under the skylights). He has used the studio for 18 years and now does four portraits a year.
 
The paintings sell for “a lot,” he said, “probably an obscene amount.”
 
Rauschenberg, et al. beget Schrager (a different kind of ‘artist’)
As Close says, the current values in the neighborhood flowed from the artists who have been there for years.
 
“Nobody wanted this neighborhood. We saved it,” he said on Tuesday, showing a visitor around his space. “Ian Schrager wants to build here [down the block on Bond Street] now because of the cachet.”
 
Close has some heavy artist firepower in his neighborhood.
 
Other notable artists, including Robert Rauschenberg, Robert Mapplethorpe, Frank Stella, Brice Marden, Jean-Michel Basquiat and Robert Franks, have also made or continue to make Noho their home, Close wrote in a July 7 letter to the Board of Standards and Appeals, which will consider the variance applications at its July 18 meeting.
 
Why didn’t he buy it?
Close’s argument boils down to a claim that no one should be able to build in such a way that eliminates his light because the original use of that space was as a courtyard between “his” building and a now demolished townhouse. If he were not the special artist that he is, with the physical limitations that he has, this would be an almost laughable argument. If keeping that space empty was so important to him, he could have bought it, probably with the “obscene” money he makes for his portraits.
 
In his favor, perhaps, is that the proposed use needs a variance from the Board of Standards and Appeals, but it appears that even an as-of-right development on that site would be fatal to the light in the studio.
 
The Zoning Committee of Community Board 2 will issue an advisory ruling before the BSA hearing tonight. After that, eh losing side may pursue administrative or judicial appeals. But Close maintains that if the developer is allowed to proceed he will have to leave the city.
 
The stakes are high
This [the studio] can’t be easily duplicated,” he said. “If I lose my light, I’m gone
 
Essentially, Close is claiming some sort of artist’s-light-easement, which has never been recognized in any court so far as I know. There is not enough detail in The Villager article to be able to tell if there are any compromise shapes or accommodations that can be made to preserve the studio’s light. I suspect that Close would (and should) be wiling to pay a lot of money to keep hi slight by reducing the developer’s “rights’ to build, if such a result is even feasible.
 
The intersection of Art, politics and Real Estate
But the developer certainly runs the risk that he will be denied his necessary variances because BSA listens to the neighborhood artists and Council member Gerson. If he does, I wonder if he will build whatever he can there as of right (or sell to someone who will), accomplishing the same result for Close.
 
© Sandy Mattingly 2006
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Jul. 11, 2006 - Now you see it (and pay for it), now you dont / what are views worth?

 
Following nicely on my post yesterday about the values of Manhattan apartment outdoor space, The Real Deal segues with a piece about vanishing views and view values. Clearly, views matter, and command a premium. Equally – this being a dynamic market in a dynamic city -- nearly all views are provisional.
 
The article talks about a (non)buyer on the seventh floor at 21 East 22 Street with (that day) “city views” and a partial view of Madison Square Park, whose feet got cold when plans were discovered to build a 40-story residence at 20 East 23 Street.
 
Similarly, some owners at The Century, 25 Central Park West (at 62nd and 63rd Streets) are losing Central Park views with the construction of the full-block 15 CPW, which has a 20 story tower in front of a 43 story tower. This new building will also take some park away from some lower floors at the Mandarin at Time Warner.
 
Fired! Your view has been Trump'd…
The article also talks about the views lost at 100 UN Plaza (52 stories at First Avenue and 48th Street) when the 90-story Trump World Tower (truly ‘Trump-over-sized’) was finished five years ago just to the south. I don’t know if values at 100 UN Plaza have recovered yet. Owners facing south in 100 UN Plaza (easily half of the units) lost nearly all of their southern views 15 years after the building was built.
 
What goes around…
Ironically, the article uses the Lincoln Towers buildings (about ten 30-story towers along West End Avenue in the high 60s) as an example of development that can both destroy views and increase real estate values. When the Towers were built in the late 1950s, anyone to the east that used to enjoy Hudson River boats and colorful New Jersey tinted sunsets lost all of that. But – over time – the introduction of so many new residents increased services over time and, thus, property values in the neighborhood.
 
"The construction of the Lincoln Towers [on the Upper West Side] worked as a positive," Kammerer said. "The expensive limestone buildings enhanced the neighborhood."

When an entire complex of properties like the Lincoln Towers is developed, it elevates the value of neighboring properties, translating into higher property values.

"There is a loss of scenic view but the association to the new units and upgrade in retail services increases the property value," Miller said. "However, more times than not, the view is blocked, but the neighborhood remains unchanged."
 
Trump’d again!
What’s weird about this example is that it was The Donald’s development over the old rail yards in the West 60s that caused the west-looking Lincoln Towers apartments to lose 95% of their river views, beginning with the first ‘Trump Place” apartments on ‘Riverside Boulevard’ in 1999.
 
The Lincoln Towers folks undoubtedly looked out over the rail yards for forty years and figured no one could build over that. No one but The Donald, as it turned out.
 
My sense if that there had been about a ten or fifteen percent differential within Lincoln Towers for apartments with river views, which was eliminated essentially overnight once the Trump Place towers started going up (eight towers in eight years), but that values have gone up, nonetheless. In contrast to the Miller quote above, in this case, the neighborhood improved. ("There is a loss of scenic view but the association to the new units and upgrade in retail services increases the property value," Miller said. "However, more times than not, the view is blocked, but the neighborhood remains unchanged.") Driving prices north.
 
But the Lincoln Towers folks (and the 100 UN Plaza folks) who lost the views lost the views. I suspect that in most cases they would – if offered such a hypothetical choice –have opted to keep the views and lose the added-Trump-value.
 
Increasingly valuable, increasingly fragile
Appraiser Mitchell Maxwell Jackson has data suggesting that the value of a “view” has increased dramatically, just as the scope of new development puts more views at risk.
 
In 1983, apartments without views compared to apartments with views had a 10 percent difference in the price. But in 2005, the same apartments were resold with a 38 percent difference in price, the analysis found.
 
The differential is undoubtedly greater when “the view” being valued is a great view. Once again Trump provides relevant data, since his buildings are either overlooking park or river (Trump Place at Riverside Boulevard, Trump International Tower at Columbus Circle) or are really tall (Trump Tower, 68 stories on Fifth Avenue at 56 Street), or both (Trump International).
 
In looking at three Trump condos and comparing “view” apartments to “non-view” apartments in those buildings, Mitchell Maxwell Jackson found:
 
In 1983, the difference in prices of a two-bedroom apartment with a view was 31 percent. In 1995, the difference was 71 percent, and in 2004, the difference in prices for an apartment with a view was 148 percent.

"The markets now recognize the value of light and views and developers now price much more aggressively for this," Jackson said.
 
Add 40% to take your breath away
Overall, Jonathan Miller puts “breathtaking views” at a huge premium:
 
The impact of view on overall property values can vary, with breathtaking views making up 20 to 40 percent of a given apartment's value, said Jonathan Miller, president of appraisal firm Miller Samuel.
 
Using protection?
The best (only?) way to understand the risk and life-expectancy of a given view is to hire a zoning attorney to review the parcels in the relevant sight line. Then, take a deep breath and try to guess what the future will bring. What changes in the city might make it possible that the present zoning could change enough to change (destroy) your coveted view? My crystal ball is fuzzy….
 
Again, take another deep breath: as Miller says "Enjoy the view while it lasts,"
 
(He notes that “lot line” views can have a particularly short life time, but that is a segue for a different post….)
Bottom line for many lofts – feh?
Classic (original) lofts in original loft areas tended to have more to do with ‘sky’ than ’view’, so their values are not as dependent on views. (Some of the original Soho lofts barely have any light to begin with; many financial district lofts have ‘canyon views’ and light, with a short visual prospect) The newer uber-lofts in condo towers are more dependent on views for value, of course.
 
Even with the older lofts, there have certainly been instances of new buildings spoiling views and, in some cases, even light.
 
Residents of the American Thread Company (260 West Broadway) with north views on lower floors are losing nearly all of their northern exposure with the construction of the new boutique hotel on what had been a one-story AT&T garage facility. They had enjoyed the view and light for 25 years.
 
Residents on the west side of 261 Broadway are losing all of their view and most of their light with the construction of a tower next door (the broker who last year sold one high floor unit that was affected conducted open houses with butcher paper on three or four windows so that everyone understood what would happen – brilliant!). Also a 25 year old view.
 
 
 
© Sandy Mattingly 2006
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Sandy Mattingly is Manhattan Loft Guy; now with The Corcoran Group (http://corcoran.com/ ; but see the disclaimer at the bottom of the page), he can be reached most easily at Sandy@ManhattanLoftGuy.com or 917.902.2491, and followed on Twitter @ManhattnLoftGuy (note "mis-spelling"). After 7+ years, the blog has moved. Links here on RealTown will work for the foreseeable future, but new posts (and all the old content) has migrated to ManhattanLoftGuy.com.

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