The Excelsior at 303 East 57th Street in Sutton Place

Some people are desperate and some are delusional, that's the reason why prices are all over the place. There has been a thread about this, you can either buy a 1br at the Excelsior for 300K and pay 3500 in maintenance and just rent one 2 blocks away for 3500. Those units are worth between 0 and maybe 100K if they are really big. I'm sorry for their owners.

In is not in sutton place -- it is the sutton place area -- but on 2nd avenue with tons of bridge traffic.... The pool leaks and was closed for months and months... some nice layout and views but horrific maintenance fees

They've always traded at a discount because of that part of the maintenamce attributable to the land lease. (Sort of like a leasehold in London, where value depreciates over time, as you get closer to end of lease, and the diminished value over the time you own is just part of the cost.) Even without the land-lease maintenance would be high, but that'd be due to the level of service. People who like white gloves and elevator operators are willing to pay for them.

The apartments themselves are fine compared to most other '60s buildings. Large rooms and some interesting variations on standard postwar layouts.

The lobby's sort of over-the-top, but it does go with the building. That retro-Miami style probably goes over better now than it did 20 years ago.

My firm represents a penthouse unit for rent at $27,500 -- it is a seven-into-six on the bottom floor, then about 3,000 square feet of terrace above that, and then a private glassed-in pool above that.

This unit is my introduction to the building, and my impression is that the maintenance is so high because of both the lease and the service level -- it's the kind of building where the doorman hands you off to an elevator man, which I think of as very white-glove Park Avenue style service, but it's expensive for buildings to maintain.

In a slow market, such as we're seeing, units with high maintenance are going to sit for awhile -- so I don't think it's an all-at-once rush to market as much as a pile-up.

Elayne Reimer of CBHK might have more thoughts, as she represents many of the units in the building.

ali r.
{downtown broker}
{email: ali [at] dgneary [dot} com

The reason prices seem to be all over the place is that the apartment size and layout vary depending upon the floor number. The layouts are different based on floors 6-26 and then 27-47. Some are also combined.
Btw, the building has a $10 million reserve fund. New rent for updated land valuation is being set any day now but it is not expected to result in any material increases in maintance (at worst another 10% or so).

mstoll, the maint. is already disproportiontely high and it hinders the apartment values

No doubt. But the high maintenance is already built into the prices of the apartment (together with the fact that its a land lease). It simply a question for a prospective purchaser: given the maintenance and whatever other carrying costs you may have (mortgage and/or oppty cost of paying cash), is it worth it when you compare to something else? Its not for everyone. But the apartments are huge, the apartment prices are relatively stable (no huge swings up and no huge swings down), the service is great, there is a pool, garage, circular driveway, etc. So its just a matter of what you want to pay for.

Exactly.

I've always liked the one-bedroom F-line, with that long wall of windows and the way it's laid out.

Just came across this case WRT the ground lease: www.tinyurl.com/303E57lease.
It's the background paragraph that's interesting, as an example of lease terms and how rent can be periodically reset.

the building needs a bit, new carpet, wallpaper, light fixtures and the brick exterior needs to be steam cleaned. also the balconies need new rails and glass.if this was done through a special assessment, the building would be the best in manhattan. the staff and service are second to none.safe secure n all polite and wonderful people.i also own an apt. on riverside blvd. in a new building its new n beautiful but cant compare.

You don't have to live there, to join the gym. It's usually not too busy in there. The terrace is nice to get some sun, where you will find many elderly building residents. (Nothing wrong with being elderly, just pointing out the demographics of the building.).

Or, at least that's the demographics of the gym's terrace. Maybe some of the older tenants (in age, and length of ownership)have sold because of declining finances.

The gym is actually closed now - I think the organization that was running it stopped paying rent and it was repossessed. They say that it should be under new management soon but who knows. Also, the demographic has gotten much younger over the past five years. Lots of children in the building now.

gym went bankrupt, I heard....

aimeehart: Ah, so that's why the gym kept sending me "Special offers" to renew! It's been about three years, since I let my membership expire. Got the last offer, sometime last winter/spring, I think around then.

They gym in the building is reopening next week. See www.completebody.com

Here come those "Special Offers" for memberships, in my mailbox, again.

Just wondering if anyone has any updates on future incrases in maintenance or the status of this building....thanks!

According to what I hear, they are not planning anticipating any meaningful maintenance increases for the next several years. They have several million in reserve funds and the next ground rent valuation is not scheduled until 2018.

The maintenance is already so high that there doesn't seem to be any money left for much needed maintenance in the hallways, and exterior of the building. I believe there are 40 apartments for sale right now and that's a huge amount for a building this size. I would think they would take some action to increase sales, like reducing the amount of down payment, and eliminating some of the services like elevator operators. Just my opinion.

This one BR has maint of $3,300 a month and no way is 1,100 sq ft, including the balcony. Something must be up for that many owners to dump it at the same time.

The estate-sale 37F just closed: http://streeteasy.com/nyc/sale/441683-coop-303-east-57th-street-sutton-place-new-york

08/01/2009 Listed by Fenwick Keats Goodstein at $1,250,000.
10/08/2009 Price decreased by 8% to $1,150,000.
12/31/2009 Listing is no longer available.
01/07/2010 Re-listed by Fenwick Keats Goodstein.
01/07/2010 Price decreased by 13% to $995,000.
04/30/2010 Price decreased by 10% to $895,000.
09/27/2010 Sale recorded for $795,000.

They missed the boat before the maintenance increase kicked in. Here're the same-plan A and F lines above the 26th floor:

09/27/2010 #37F ...$795,000
07/30/2009 #40F $1,200,000
07/09/2009 #47F $1,200,000
03/17/2008 #40F $2,000,000
10/12/2007 #39F $1,750,000
06/27/2007 #30F $2,100,000
06/06/2007 #41A $1,375,000
07/13/2006 #36A $1,400,000
12/08/2004 #40F $1,400,000

Can we leave comments here?

This building is on a land lease. The lease will expire in about 20 years. The building will then become the property of the owner of the land. So, when you buy an apartment here, in effect you will own it for about 20 years, and then you will loose it! The only way that you have a chance of retaining your apartment is if the coop board manages somehow to buy the land from the owner. In 2008, when the last lease negotiation took place, the fair value of the land was determined to be $170 million dollars! Assuming that the owner wants to sell the land, by the time the Coop board gets to buying the land, it would probably be worth over $200 million dollars.

SUNY,
When the leas expires...if a new lease is not agreed and the coop does not buy the land what exactly happens? Everyone clears out of the building? the structure becomes the property of the land holder? Does the land holder end up owning the building? are there any cases like this on the books where, in the end, an agreement was not reached? The building charges are already killing the building...

Suny: The coop has a right to extend the lease for an additional 25 years beyond 2038--this is provided for in the original lease itself. So the lease runs to 2064 assuming the lease remains as is in the future.

And mstoll should know, having seen the lease and done so many sales there.

Lots of buildings have been razed and redeveloped when leases end, but this building is as big as the lot can carry, so there's little danger that in 2064 the landowner will tear it down and boot the co-op out.

As it is, the landowner has a perpetual income stream on the periodically-appraised value of the land, with no expenses to speak of. Good for them, not good for the co-op shareholders, but the prices reflect that.

If it is such a bad deal why are some of the lower priced units going into contract?

As with anything, it's a good deal for some but not for others. (Assuming anybody should be buying anything now.)

mstoll puts it well, up near the top of the thread.

SUNY- If the land is valued at $170 million, that puts the average land value per apt at over $500,000 assuming SE is correct that there are 315 units. I know that there is a mix of apts(studios and up) but that is a huge number especially considering it is at the entrance to the bridge. If that is the value, then there is probably little to no chance that they will get a consensus of current shareholders to buy the land like the east 62nd(?) building just did unless their average sales price goes lower than it already is. The 37F sale is only the beginning. But, they'll never be able to sell at any reasonable rate unless they do. Would they be throwing good money after bad to buy it at that number?

I heard that the land lease was approved until 2084? Was there just a recent increase in maintence - is that why there are so many apts for sale? or do they periodically increase the common charges?

Falcogold: if an agreement is not reached to buy the land, the owner of the land simply takes over the building and it becomes his! He is then free to sell the units to whomever he wants.

MSTOLL: my understanding - i could be wrong - is that the building lease does in fact go until 2064. At that time, the lease runs out and there will be no further renewals. However, if I am a buyer and wish to get a 30 year loan, there will no bank in the world that will give me a 30 year loan knowing that in less than 30 years the lease runs out. Thus, for all practical purposes, for the purpose of a buyer, the lease runs out in 2034.

buyer: I do not know whether these units are good or bad deals. What is likely, though, is that the value of these units will diminish over time, given that the units will start losing significant value on 2034, and will be worthless in 2064.

Skippy: I agree with you. Except that the situation gets worse. If I am the owner of the land, why would I want to sell the land, knowing that I will be getting a very good lease rate for the next 50 years. After 50 years, I get to own the building and the land. I can then evict the owners of the apartments and sell the units to the highest bidders. Good deal! Why would I want to sell the land?

JW2011: No, the contract of lease specifically calls for the ending of the lease in 2064 unless the building gets demolishes and replaced with another building.

The lease does go to 2064, and as a technical matter the Coop can replace the building in which case the lease continues to run for another 25 years after 2064--although that is not practical, so 2064 is the real year to think about. There really are not too many cases or examples of a court in New York or New York City forcing the evicition of hundreds of apartment owners at the end of a land lease. The land owner may want to fight that batlle (and may in fact may win), but its not a bet I would want to take if I were him. Also, if you look at the ACRIS filings you'll see that very few if any of the apartments have mortgages--most pay cash.

so if you buy in this building,you are really just leasing your apt for another 50 yrs

Is there any risk of significant increases in maintenance before 2018?

Actie- always a risk for increases in maintenance. I would stay away from this building AT ALL COSTS because the maintenance/land lease issue with the property is so horrific. This building will be a historic first in terms of land lease/owner cases somewhere down the line. This buildings super-unique situation is a real estate case study waiting to explode.

Who owns this lease?
Just fascinated by the deal. Effectively, the one who does the deal never lives to witness it's outcome.
So it's not win-win, it's not win-lose.....

It's win-die.
Where do I read the whole story?
Anyone?

pretty sure I won't be here in 2064

Brooks2
13 minutes ago pretty sure I won't be here in 2064

keep acting like a dick and you won't be around for the holiday season, asshole

how will you make sure of this?

good evening pedophile. how many little boys did you molest in 2011?

your point?

http://www.usatoday.com/sports/college/football/bigten/story/2011-12-08/jerry-sandusky-sex-abuse-charges-bail/51742628/1

friend of your's cunty? don't bother answering, you are a filthy pedophile liar. now fuck off and let the grown ups talk. take brooks with you.

falcogold1, the landowners are the heirs of Shapiro and Kern. (Shapiro died a year or so ago.) They also own the co-op's unsold shares. There was also a partner named Olnick involved when it went co-op 40 years ago, but don't know if he had an interest in the land.

The co-op and the landowner fought for many years over whether the land value (used to determine the rent) should be considered as unencumbered by the lease, and the co-op lost. They paid back rent of $10,000,000+ in 2010.

Oops, it was Ralph Kern who died in 2009. Harris Shapiro died in 2004.

so what is the right price for a sqf in this place?

What is the deal with subleasing in this building? I see some for rent, and some rented for over 2 years...

Am thinking about buying in the building. Should I?

there are a few aparments for sale here any thoughts should I buy or not.

dont buy there the maintance only goes up not down the prices have dropped. friend had a unit on market 185 days and finally they sold it at a loss. small loss but in a strong market what does that tell you. no land lease people run away from them and are dumping the units.
other units on market near by less glitz but strong investment

you can rent in excelsior for a max of 4 years. lower floors have less maint. 1 bed 1 bath maint is about 1600-1800
1 bed 1.5 baths have 1100sf maint is 2500

dose any one knows for sure when the lend lease on the building expire ?

thanks guys all this info was very helpful

Anybody has insights on the upcoming land value reassessment in 2018? I see lots of units for sale and the price is dropping as well. Thanks!