Townhouse Auction 3 East 10th Street

Someone smack me awake with a strap on! I thought auctions NEVER happened in nyc?

So a doc office for my wife, an extra unit for the nannies, and a whole entire apartment to store my son's Lego sets! Wow! Can you imagine, I almost bought a flex 3 for $2.5mm? WTF waz I thinking?

So the strap on talk is during the day when the kids are in school and the wife is at work.

But then it continues when the wife is at home

and when the kids are home too.

I bid 3.5.

For the townhouse or for w67thstreet's strap-on?

You are so on. $2.5mm for flex three, shit 4 doc offices alone is worth $1.5mm to me. $4mm. That's like getting 3 floors for FREE.

I think it's going to go for mid-7s.

If there are no weird tax implications ("partnership"?)

I doz like your write ups on properties. But, we are too early. Before this is thru there will be plenty of busted 'partnerships' that bought in the last 6 yrs. Trust me, partnerships never like capital calls much less sitting on 'paper' loses.

It has been my experience partnerships never work in real estate. :). Bf it's all said and done well both be able to pick up units like that Wo having to seek financial partners. :)

Yeah. Financing is what separates the wheat from the chaff, though.

Actually, nyc10023, in 1996 to 2000 there were enough desperate sellers they would carry the paper. Crazy huh? But this assumption that liquidity is always there at less than 6% is a 'bubble' phenomena. For a seller, you just structure it as a bond, with the ultimate fallback of getting your property back minus dp as your cost basis. In fact most generational wealth transfer in re is structured this way, but why well to johnnie when a lemming will pay you $5000psf via geitner?

'sell'

If you want to talk history, W67, prior to 1990, many TH deals were seller-financed. But (I thought) that they had the flexibility to do this because their lender allowed them to do so. Is this common today?

My father in laws Brownstone in Chelsea was owner financed., but he bought in 1961.

Indeed, it used to be a time when ppl WITH $ had leverage over ppl who could sign an IOU. WHAT A NOVEL idea... ppl w/ assets over lemmings w/ a 700 credit score and stars in their eyes....

O.K. w67th:
"Smoke gets in their eyes..."

I was saving a new discussion topic for next week...a lead-in to Halloween...

But, now is the time... the time is now...

The time is always now.

I'm going on Sunday to see the place.

How can the "previous prices" have been $9,950,000, when "the property has been owned by the same family for over 40 years?!"

^^^^ It was listed this summer at that price.

Family Feud Forces Auction in Village

By JOSH BARBANEL
Behind the stone lintel and bay window of a 19th-century townhouse just off Fifth Avenue in the heart of Greenwich Village, a bitter dispute between two middle-aged brothers has forced the rush sale of the property at auction in a matter of weeks.

The wide Romanesque townhouse at 3 East 10th St., a few blocks away from the Washington Square Arch, was recently listed for nearly $10 million.

But the townhouse, now divided into small apartments, failed to sell and was scheduled for auction after one of the brothers, Willard Baldwin III, 56 years old, who lives in the building, changed his mind and decided not leave the property that had been in the family for a generation.

Mr. Baldwin blocked a broker with Halstead Property from showing the building, tore down a for-sale sign, and advised several tenants who had been negotiating buyouts to stay put, according to court papers. Mr. Baldwin didn't respond to requests for comment.

Now, the 25-foot wide townhouse, partitioned into medical offices and apartments, is due to be auctioned off on Oct. 21 by Misha Haghani of Paramount Realty USA, with a minimum bid of $3.5 million.

"It is a New York tragedy," said Christopher G. Conway, a lawyer who negotiated a settlement on behalf of Willard Baldwin during the spring, "that such a great building in such a great location that had 120 years of history" had to be disposed of at auction.

But Mr. Conway added "the real tragedy" was that "the brothers didn't have the relation that their father wanted them to have" and the family "has been torn apart for no better reason than money."

The rush auction was scheduled after a recent court order gave Mr. Baldwin's younger brother, Ned, a 52-year-old building inspector in Stockbridge, Mass., control of the property last week, and barred Willard Baldwin from interfering.

Ned Baldwin said in an interview that he, too, had emotional ties to the building, but he found that after a series of unresolved disputes that he could no longer work with his brother "as a business partner anymore."

"If I had my way I would keep the building until I die and give it to my daughter," he said.

The brick-and-stone townhouse was built, along with a twin building next door, in 1890, and was purchased by the father of the Baldwin brothers, Willard Baldwin II, an investor in real estate in the Village, in 1968, according to property records. In the 1990s, he gave each son a 50% interest in the building.

In a dispute going back several years, the brothers couldn't agree on how to manage the building. As a result of their stalemate, two apartments that could have been combined and rented for $5,000 a month remained vacant for three years, court papers said.

Last November, Ned Baldwin went to court to force a sale of the townhouse, with the proceeds to be shared by the two brothers.

Willard Baldwin eventually hired Mr. Conway to represent him and in May. he signed an agreement to sell the house. In June the property was listed with Barbara Godson and Charles Homet of Halstead Property at $9.95 million, a price that was predicated on the building being delivered without tenants.

When it became clear that the tenants weren't willing to leave, the brokers recommended cutting the asking price to $8 million, but Willard Baldwin refused to agree to the cut in asking price, court records show. Ms. Godson declined to comment on the listing.

The auction deadline was set in the original agreement between the brothers. The timing was intended to make it easier for the brothers to close on the sale before the end of the year, after which capital-gains tax rates are due to rise, unless there is action by Congress, lawyers said.

I attended yesterday's inspection and took photos: http://malcolmcarter.wordpress.com/2010/10/13/village-townhouse-in-forced-auction-generates-interest/

I predict $8.5 mm.

ali r.
DG Neary Realty

This is the biggest scam out there. This is NOT an absolute auction and no matter what the winning bid in the auction is, the seller can accept or reject the winning bid 7 days after the auction date. Where is the logic here? I can buy this without even participating in the auction as long as i know what the winning bid is. What stops the seller rejecting the winning bid and accept my slightly higher bid? It’s about time Paramount Realty stop misleading buyers and brokers. This is bad business for everyone!

the previous listing of over 9M was for 100% vacant building...if you read the due diligence package, you can see there are significant possession issued with some rent control and rent stabilized tenancies...

Well, if Ali is right that someone would pay $8.5MM for this, add in a 7% buyers premium, a few more percent to get the three RS/RC tenants out, maybe a little more if you need to terminate any multi-year commercial leases, and you have sailed way past the listing price, and a pretty rich price for a place that requires a multi-year total renovation.

nyc_sport, she's a HARVARD borker, don't question her. Who the fk do you think you are? seriously, it's $8.5MM cause thatz a HUGE discount from $9.5MM after sitting a year...and if it don't sell in a year, they'll have to pay cap gains at 40% negating even a $12MM sale in 2011,.......

you know what these brothers deserve each other, let them pay cap gains and fill our gov't coffers. what a comedy of errors....

Results of last night's auction: http://malcolmcarter.wordpress.com/2010/10/22/the-big-apple-village-townhouse-is-auctioned-more/

seems like a good but not great deal at $6.5 million. the house needs a gut renovation and has rent stabilized and controlled tenants.

a more attractive, vacant, townhouse right across the street sold for $8 million earlier this year, also requiring a gut renovation.

I stand corrected. I do think at that price it's a steal.

Ali r.
DG Neary Realty

And one also across the street, at 6 E. 10th, now undergoing a gut reno, sold in July 2008 for $13.95 million. Of course, that was before the collapse of Lehman Brothers was chiefly responsible for causing our housing market to tank that year.

$800/sq foot for a rent regulated building that needs tons of renovations a steal?

Given the number of interested parties, I'd say it's neither a steal by the buyer or highway robbery by the seller. It's the market speaking.

As for the three stabilized or rent-controlled tenants, the buyer, who is in no hurry to renovate or move his family into the place, naturally has options. These include letting nature take its course, buying out the tenants or deciding that the building has plenty of room for everyone.

can't the potential buyer evict the rent stabilized tenants if they plan to use the whole building as a primary residence?

malcolm,

obviously he has options with the rent regulated tenants. but i hope you aren't arguing that the presence of such tenants doesn't reduce the value of the property? all of those options are quite expensive--including leaving them in place, which costs an arm and a leg in lost rental income.

a rent-controlled senior citizen who's been living in her apartment for 55 years?

short answer: no.

Not arguing anything, happyrenter. Yes, their presence does reduce value, but the numbers worked for the winning bidder. For the record, two tenants are rent-stabilized and one, rent-controlled.

@happyrenter, thats incorrect. I've read cases before where they were able to evict everyone and trn an 8 apt house into a single family residence.

Happyrenter is right.

You can evict RS (as long as they're not seniors), but NEVER RC.

Deanc,

Clearly the people in that building were neither rent controlled nor senior citizens. Even then it can be enormously expensive and time consuming to evict stabilized tenants for owner use. Rent controlled and senior citizens with any rent regulation cannot be evicted.