3 Hanover Square / FIDI generally

I have represented two clients in 3 Hanover. The quality of life in the building is very high, but it does not have some of the amenities that the luxury rental competition does. As far as sublets, sublets must be board approved, and the current board is not very fond of them.

ali r.
DG Neary Realty

I am in contract for an apartment there and have done pretty extensive research on the building and the neighborhood. The neighborhood is fairly quiet at night (which is a good thing in my book). It is a bonus that this building borders Stone Street- we've hit a couple bars and restaurants here and the food was very good at all the places we dined. We didn't have to wait for tables, there were healthy food options even at the bars, and there was a pretty good mix of young couples and singles. Everyone talked about their excitement for the summer when the Stone Street restaurants open their outdoor seating areas. Stone Street feels an awful lot like a street you might find in Europe. Another perk is it's proximity to South Street Seaport- there is a new Water Taxi Beach with outdoor concerts planned weekly- sure to drive more people to the neighborhood and increase desirability. Pier 11 is just 2 short blocks and there are ferries that leave here going to Sandy Hook beach at the Jersey Shore as well as a free ferry that goes to Ikea/Fairway in Red Hook. The one downside of apartments in this building is the resale- I have noticed apartments tend to sit on the market for quite some time and owners are forced to lower their asking price. However...if you are buying here you will get considerably more space for your money than other neighborhoods without needing to leave the borough. Many subway lines meet or end down here, so you have a number of lines to consider to commute around town. Fresh Direct seems to be a staple for groceries in this neighborhood, but I plan to shop at the Whole Foods and hop the 2,3 from Chambers to Wall St. which will drop you off just two blocks from the building. Whole Foods also delivers. They are developing a promenade from Pier 11 to South Street Seaport over the next 2 years which sounds interesting. I'm look forward to the convenient access to the bike path that runs along the waterfront.

The apartments' floor plans are overstating footage. It's a business district, unless Wall St. moves out it will always stay the same. Visit it during the weekend, and it's dead.

Food wise - stone street is mediocre, unless you're into mini burgers. Better a take few stop rides to chambers and walk up for better restaurant choices. Bars are fine for after work activities, probably loud during the night so don't buy the apartment facing that way.

And yes, expect to commute for groceries. The local supermarkets are at least 7 block aways, and they mostly sell prepared food vs fresh food.

Oh and tourists, Sea Port will be packed with them all the time.

Thanks all for the feedback. Melymel, hit the sweetspot of my concern which is that the resale values on these apts seem to be so low. I am buying to live not to flip, but still I would like to get a place that I could turn a profit on 5 to 8 years down the road. Do you see this neighborhood getting "hot" any time soon?

I noticed the overstatement of footage as well. As for investment value, I'd say FIDI is just never going to be that hot a neighborhood because it doesn't have the right mix of elements. It's not particularly artist or family friendly. It's an expensive area, dead at night with a dearth of good food options, lots of tourists. The type of people who make an area interesting and fun are sorely lacking.

I would not count on turning a profit at 3 Hanover in 5 years. I first rented an apartment in the building in around 1992, then it was one of the only games in the area. There are just too many other buildings in the area that are superior and at this stage of the game it's difficult to gauge where prices are going to settle in the new condo's and then at a building like 3 Hanover. Why not rent in the building for a year and see how you like the hood?

I am surprised at these grocery comments as Zeytuna -- check it out -- is one of my favorite places to shop in all of Manhattan, reminding me a little of the old Balducci's with better prices.

Downtown without question is growing, having seen a huge influx of residents since Keith's day. However, that itself raises a number of issues, including availability of schools.

One reason resale values on these apartments tend to be low, I think, is that there are very few comps. I raised this issue on another thread -- you don't really have co-ops around 3 Hanover, and the layouts are so unusual that it's tough to comp the building to itself.

However I don't think holding for 5 to 8 years would turn out to be a bad proposition (for those who don't know me from this board, I'm a "buy to live there" not "buy to invest" type broker). I would search especially for a unit that you could add value to, by, say, raising a dropped ceiling (of which there are many). If you're really looking for a gentrification play, though, I'd go for South Harlem.

ali r.
DG Neary Realty

Zeytuna sucks, its sells mostly precooked food of dubious quality. Its geared towards lunches of the locals workers, not folks who live there. Not sure how you even liked it.

I agree with ali on the So Harlem gentrification play. If you believe the 20 or 30 year trend of Manhattan gentrification will continue, So. Harlem offers discount pricing, and negotiability, and you can walk to Central Park and to the 125th St commercial district. Every decade or so, another ten blocks of the UWS becomes more acceptable to larger numbers of people. I see residents and retailers migrate north for cheaper rents over time. It is a gradual but very real migration. Plant yourself as far south as you can afford, and let the migration pattern work for your investment fundamentals. I think Fidi could be interesting at enough of a discount, but I see on Curbed yesterday that celebrity Christopher Meloni bought a high quality 750 sq ft one bedroom condo for $910k. To me that does not represent much upside. The build out of Ground Zero is guaranteed to add value, but that could take 10 to 20 years.

Where do you work? (location/commute wise)
how close are the trains that you need to utilize on a regular basis?
how important is battery park to you?

i moved to FIDI/battery park last November, and i have to say, i find the area great for all my needs.

within a 2 block radius i have 24hr grocery stores, the N,R,4,5,6,1 train

one of the best parks in NYC (battery park, west side highway), a nice movie theater in battery. shopping in the area might develop once the WTC is back up and running as well.

Battery Park/FIDI is not as trendy as other parts of the city.

Zeytuna has a nice butcher who will sell things like ground lamb that aren't easy to get in a standard grocery store, fresh high-quality produce that's cheaper than Whole Foods, and some interesting specialty foods.

I agree that I wouldn't buy Tide or other staples there, but I wouldn't at Whole Foods either.

ali r.
DG Neary Realty

Just listed a river-view studio in 3 Hanover for $479K. To the list of amenities to come in the next few years, I'd add the new elementary school that's planned for 8 Spruce, the Frank Gehry tower to the north.

ali r.
DG Neary Realty

Not to open a can of worms about school zoning, but the last time I checked the Spruce street school would not be the zoned elementary school for 3 Hanover Square.

While in the name of Fair Housing I'd like to talk to all potential buyers, I don't necessarily think that a studio buyer is going to be seeking out a particular elementary school.

However, I'm a real estate agent, and real estate agents are optimists, and I can imagine a world in which the existence of a new elementary school attracts other desirable retail and services. The area has already mushroomed in the past ten years -- I'm thinking that will continue.

ali r.
DG Neary Realty

Goldie is correct. South of Maiden Lane the kids are zoned for the other new school in the southern part of BPC. The fact that this area was zoned for 234 and now is not cannot have helped resale prices for 2 BR units and up.

Update with Policy Change: 3 Hanover Square is now a nonsmoking building

I don't think I would ever buy in a "non-smoking building". Not that I want to live in a building full of smokers, but I worry about what other things the type of board who would enact this policy would think they have the right to tell you to do inside your own apartment.

Unfortunately (or fortunately depending on your view ) 30yrs you may have to start operating outside of your comfort zone .... the following is from habitats magazine

There’s a new law in town – Local Law 147 – that requires all residential buildings to create a written policy stating where smoking is permitted or prohibited, including common outdoor areas such as courtyards, rooftops, balconies, and patios. The legislation also mandates that the policy be provided to all co-op shareholders and condo unit-owners and be publicly displayed in the building no later than August 2018.

The big question is whether the new rules will encourage co-ops and condos to impose building-wide bans that prohibit smoking within individual apartments and in private outdoor spaces. “You can see what direction the city is going in,” says Talel. “There’s a real concern about health hazards.”
Andrew Lazarus, senior vice president at Tudor Realty, agrees that the statute may well push boards in that direction. “Keeping up with new regulations and incorporating them into formal documents is business as usual for boards and managers,” Lazarus says, “but where this law differs is that it will very likely lead to a larger, ongoing discussion about buildings going smoke-free.”
It’s already a hot-button issue, and one that seems to be gathering steam. “I’ve noticed a real change of attitude at annual meetings,” Lazarus says. “Compared to years past, shareholders are much more willing to talk about the issue, ask about what other buildings are doing, and hear both sides of the argument. And boards have already been actively exploring different policies and soliciting views by surveying shareholders and unit-owners.” With the new law, he adds, “there will definitely be an extension of that conversation.”