15 Mad Square Sell at Big Discounts

Apocolypse? For the buyers perhaps. The developer, not so much. If the buyers think they got a bargain because they negotiated below "ask", I feel sorry for them. Let's look at the same line comps.

06/10/2009 #14C $1,450,000 -14.7% $1,700,000
08/18/2008 #12C $1,275,000 $1,275,000
11/05/2008 #10C $1,200,000 $1,200,000

05/01/2009 #13F $2,650,000 -24.3% $3,500,000
08/18/2008 #11F $2,535,000 -1.6% $2,575,000
08/12/2008 #12F $2,625,000 $2,625,000

So the lucky buyers took the opportunity to jump on a hand grenade in mid-2009 by paying a 15-20% premium to pre-construction (a.k.a 2006) pricing for 14C and about flat to pre-construction pricing for 13F. I picture the buyers sitting around a table with the developer and some of the developer's buddies playing a friendly hand of poker and wondering who the sucker at the table is...

And the fun isn't over in the C line.

The developer is showing 15C as in contract since Feb. Seems like a long time to close on a condo. 14C closed in less than a month from contract. Watch to see if 15C gets spit back on the market.

Also, the original buyers of 11C (for $1,225,000 pre-construction, closed last summer) are trying to flip. This one and 15C will be good tests of whether there is a deep market for C line units at above pre-construction prices.

Where do you see these going? Down to $1,000/ft? Also re 14C, looks like it started at 1.8, so that's a bigger drop than noted above. Also looks like this apt was bought by an investor and is now on the market to be rented at $7500/month. That seems unlikely.

Sidelinesitter, I get your point, though you should know that the C line units below 13 do NOT clear the building next door. That means these units look directly into a wall one building away. So it seems a fairly significant premium is in order -- though obviously not at a $1.7M level.

And I could be wrong, but I think on both units you cite, the developer was the seller -- so they never got the benefit of the wild pricing.

Also, with regard to 15C -- even though it went into contract, the unit was not completed so there could be no closing until recently. I'm guessing it was just finished in the last 30 days.

Finally, on 11C -- they are just naive. Someone needs to tell them "you face a wall".

OMP - thanks. I did not know that and in fact was wondering as I looked at the listings what the non-park facing view was. I was guessing that a double digit floor number would be enough to provide what listings always call "open city views". Guess not.

Yes, the developer was the seller on those two units. My point was not that the developer got the benefit of wild pricing but that they priced at a wild level and the buyer should not think they got any real benefit from the "discount" that they negotiated.

Anyway, thanks for detail.

We need help! We have been looking at several units in 15 MSN. Broker and developer alike present this as a one-of-a-kind building that anyone would die for. Yes, amenities are beautiful, but so are in thousands of other apartments. We love the location, that's a major plus: downtown greenery is to be appreciated!

Now, we see that this developer is inflexible and that by setting absurd asking prices, brokers fight hard ... to settle on peak market prices...
Also, sooner or later there will be a building coming up on the east side, which will imply sealing off many windows on that side.
In any case, all back apartments have rooms facing tiny courtyards: they're dark!

Besides the park, the Mieles and Waterworks, which are really a tiny fraction of the cost of the apartment, the wine cellar (big deal; anyone can have wine refrigerator at home), the chandelier in the lobby.... Can anyone tell us what is so extraordinary about this building?

Is it quiet? Are walls sound? Is the park safe at nights? Do they keep the building super clean?

We would appreciate enormously any information, experience, comparisons. If any of you lives there already, are you happy with your decision?

Any advice would be welcome!

I live in the neighborhood and I don’t get it. The area is nice and has both pros and cons. The park is lovely/safe/well-kept, the playground is great, the dog run is fine, the restaurants are very limited, markets are inconvenient, subways are so-so, broadway in the mid 20s is gross ………. and there are so many cheaper options within blocks. And if you travel south, some of the cons of this location actually improve (restaurants, convenience).

I do not understand what is so special about it.

I'm a park booster (live facing the park) and actually love this building. And really love the area. When we moved in, there were problems with homeless on the park. That has been improved 95%.

I believe this is a pioneer area for non-pioneers. Broadway in the mid-20's is gross . . . but when do you ever go there? Two new hotels on Broadway (the Ace on 29th and another on 28th) begin the slow improvement. The MAve on 28th and Madison helps with that block. And the Gansevoort at Park and 29th will bring other changes.

There aren't as many restaurants as flatiron, but enough to keep you from going hungry. 11 Mad, Tabla, A Voce, to Pamplona. San Domenico reincarnates as SD 26 in this very building this fall.

The lack of a grocery store is the biggest downer. Latest rumor was that the entire ground floor of 200 Fifth (the old toy building) was going to be a 60,000 square foot italian market and eatery run by the Bastianich folks. Hope that's true.

In any case, the architecture is fantastic, the location terrific, and the future, bright. If the market ever recovers, expect development here to continue. 1 Mad (sold in the last boom) was going for $2,500/sf. If (big if, granted) the Met Life tower ever goes, it will have to be over $2,000/sf to make financial sense.

Sorry RonBil, like I say, I'm a booster, so discount everything I say! The area isn't where it will be . . . but when it gets there, we won't be able to afford it . . . so we're happy to pioneer for a bit! :)

OnMadPark - you are making sense. A lot. thanks!

Interesting thread. I'll supplement, repeat some of what OnMad has said.

14C clears the building to the east, 10C definitely does not, 12C probably doesn't either but I haven't been in 12C so cannot confirm for sure. So some premium is deserved.

Regarding 13F I would note that the buyer is an insider.

As for 15C, the 15th floor is not complete, its the 1 remaining floor not completed, thats why 15C hasn't closed.

I generally agree with OnMad's last post although I'm much more bullish on the restaurants. Scoots...restaurants very limited? huh? I think one could consider this a restaurant mecca, unless you only count places within a two block walk. Besides the ones OnMad mentioned, Ben and Jacks steakhouse just opened at 27th and 5th, Primehouse at 27th and Park, Wolfgangs at 33nd and Park, Rosa's down on 18th, Blue Smoke, Hill Country, Koreatown 7 blocks up 5th Ave, and on and on. Italian does seem a little light, hopefully SD26 will fill that void and not be super expensive. Also don't understand scoots comments about the subway, course I'm a 6 train guy mostly. Supermarket is definitely the downer, I've heard the same rumor OnMad but nothing about it in awhile, I'm not optimistic.

ccdevi -- interesting about 13F! That makes a lot of sense -- the floorplan looks terrible on the page, but actually works out pretty well in real life.

And I can confirm on the 1BR (east facing) units that the magic cut-off is 13 for clearing the building. 12 and below do not).

And I agree on restaurants. There's also Olana, Prana, Ilili, La Bretagne all within 2 blocks.

I looked at 15 MSN. 9E, 10F, 14F, 17C - were the ones I looked at. The 10F line while it doesn't clear the building has a spectacular view of large gargoyles of the building next door. I personally prefer this view than of roof decks and water towers etc on 12 and 13. 10F also has a view of the Empire State building from the bedroom and living room.

OnMadPark and ccdevi --- I have a question for both you. Does this building have a live in super? How is the building aging...I heard about issues like floor board cupping. might be too early to tell. The doorman and concierge seems a little lost. Not very white glove for a high quality building like this. Any comments. Grand Madison seems to have better service.

Also what happens to the bottom 8 floors. Are these going to remain commercial or are they going to be converted at a later stage. If they get converted...will this be a different building altogether or they will become part of the same condo organization.

Also, how active is the condo board? Is this constituted now and taking an active role in taking care of resident issues.

kalakota, most of the first eight floors aren't included in the condo. The condo includes "a portion" of the land and building. First time I've seen that in a condo declaration, and doesn't seem straightforward, but may be common for all I know. Sponsor can do what they want with the non-condo portion. The condo declaration should detail how expenses are allocated between the condo and the remainder of the building.

The first sale was only in November, so the board-formation process laid out in the bylaws may not have happened yet. The sponsor will have two of the five board members as long as the sponsor has 10 or more units.

kalakota, I tend to agree with you about the northside view from 10 versus a little higher. The building does not have a live in super. Cupping has been a problem which they are addressing in various ways. As for the doormen/concierge, they are likely going to be replaced. They are really security type people, the sponsor has them in while construction continues. That said, I don't really have a problem with them. The bottom 8 floors are commercial floors and separate. The condo board is still controlled by the sponsor, the current owners however are very active and its clear the condo board will be very active once controlled by the owners.

Looks like we're getting a few more closings here.

One of the best park facing units (16E) just closed for $4M. That's a full $2M off the listing price. At around $2,400 sf, it comes to almost $1,700/sf. Personal opinion-- that feels about right . . . but waaaay below ask.

Then, one of those troublesome D units closed for $1.31M . . . down from a $1.65M ask. That translates to just under $1,100. I'd say that was right except for one thing -- the next door neighbor. The building is for sale, and the space seems ripe for development. It's an odd, narrow lot . . . but if they do anything high, it could change the views these units have into "building shaft" views. If someone knows something different, maybe $1,100 is right . . . otherwise they are taking a big risk.

Does anyone know what is (or could be) going on with the building to the east?

You should check out the building next door (Grand Madison - 225 Fifth Avenue) ...there are comparable apartments there. FYI one is listed for auction (see nytimes) for less than $1000/sqft!

go2nyc,

That's just the "opening bid" price. Though I think the sale prices in that building hover around $1,000 for units that don't face the park (and that's almost all of them!).

OnMad, the park facing unit you refer to that closed was 9A (16E on the other side also closed recently). Also note that $4 mil is actually very much in line with the original not cheap phase 1 asking prices, for example 10A closed for $4.05 and 11A $4.1, both phase 1 contracts. The D sale, 14D, sold at a premium to the phase 1 deals, 10d $1.025, 11D $1.075, 12D $1.195 (although of course the fact that it clears the building to the east explains that). The asking prices you refer to were the absurd phase 2 prices the developer got greedy with (and closed very few deals at). Anybody can make up an asking price that has no basis in reality.

ccdevi --

The only thing I'm trying to get at is what is current market value -- so I'm not sure what point you are making.

As you rightly say, the current asks are absurd (and NOTHING is moving at those prices). And my only interest is in what is the "right/market" pricing. Now that there are a few units moving, we can find out how big the spread is between their ask (absurdity) and the actual sales (reality).

I'm not really sure what the phase I sales prices have to do with anything. Wasn't that 2005 or so?

And yup, sorry, i gave the wrong unit number -- it was 9A. But the price (about $6M) and ppsf info are all correct.

ccdevi -- you seem to know a lot about the building -- do you know anything about the building right next door to the east? It seems to be emptying and for sale -- and I'd heard they can build up to 12 stories withoout changing a permits -- but that's very unreliable info.

If I were in any of those units with east facing windows -- including those big B units -- I'd be worried about them putting up 12 stories (at best) . . . and a north-side-of-the-park skinny-and-tall one madison-esque structure. It would literally turn those gorgeous (above 12 th floor) views into darkness.

As long as anyone can convince themselves that that these psuedo reduced prices are some kind of reasonable deal then it makes me worry about the whole market. I love references that say Madison Park is a beloved park -- it's a multi-crossed, heavily trafficed intersection with a large grass island.

Jim--

Sorry, but count me as a resident and one of the convinced. It's fantastic as a view, fantastic as a location . . . and I'll count on folks like you to keep prices down while I'm still buying! :)

go2nyc - do you have the link to nytimes article on auction at Grand Madison?

OnMad. I think my point is obvious. Presumably current market value is evidenced by what people are currently paying. You focused on how the prices people were paying were way off ask, what was your point? Phase 1 contracts were signed in mid-late 06 and early 07.

I don't know about the building to the east. If I was thinking about buying an east facing unit I would certainly investigate but my general sense is that I would be shocked if that site gets developed anytime in the near future.

"I'm a park booster (live facing the park) and actually love this building. And really love the area. When we moved in, there were problems with homeless on the park. That has been improved 95%."

I've been by the park 5-6 times in the last month in the 7-10 range. If thats 95% improvement, holy moses. There is a homeless CAMP on the north side of the park (sidewalk outside the border). Clear pot smell. Then random homeless guys every few benches.

So, before the 95% improvement, what was it? A Bob Marley concert?