Common Charges

The building says that it has 44 units in the description (6 floors hotel and 6 floors apartments). I would assume that the "units" include hotel units. so maybe only 22 actual apartments? Either way, those common charges are insanely high, especially for new construction. Something does not add up. I would agree that the hotel is somehow impacting common charges in a way that is favorable to the developer/hotel

no argument here with that logic. The only way you can truly find out is tell them you are seriously considering an offer but want to see the condo offering plan. the plan will lay out the budget of how they came up with total costs, then you will see the allocation.

i see they just came online today and the 3br are almost 2500 per month in CC ignoring re taxes, that is very high.

also keep in mind i also saw that their tax abatement is only 15 years. Something to keep in mind as all the rest of the buildings around here have been 25 years.

Agreed, the 3 bed cc is outrageous. They do know this is harlem right? The hotel should be subsidizing the owners, b/c you have to put up with people constantly turning over in your place of residence. Something is not right.

well are hotel services mandatory?

I don't know what they are going to do. I like the apartments, but would never ever consider paying common charges that high. And I'm sure I'm not alone.

add to that a greater chance of a bedbug infestations and this place is a dud.

Bedbugs in the Waldorf. They like the beds of the millionaires. Harlem is immune to this point.

The common charges for the two bedrooms have actually been reduced to approx $1300. I am seriously considering buying here and was leery about the high common charges relative to the marketplace. I had my attorney read the offering plan and review their budget and he said their numbers do add up and the hotel has nothing to do with the residential tenants' common charges. Having looked at several buildings in the market I found these apts to be the nicest and the prices lower than other nearby new developments, thus taking away a bit of the sting from the high cc's. Having a mini W Hotel (its called "The Aloft" but they are both part of Starwood) adds a panache to the building which will have a separate entrance from the hotel but tenants can access the hotel lobby without going outside if they wish. Having only 44 residential units gives it a boutique element and a great thing is you are two short blocks from the 125th street subway and then one stop to Columbus Circle.

I would just keep in mind that there are only 44 units bearing the costs of the condo. Depending on just the help you need, Super, Porter, doorman, etc it is costly and any increase is spread across a few apartments.

I bought in the Livmor at the end of the day with some combinations they are doing there will be a total of 70 apartments, including the super apartment. Any changes that are made will cause a decent increase in common charges. for example at this time we have only one porter. I feel that it is possible we need at least one more porter or someone to go clean the floors, vacuum, etc. This cost depending on whether you hirer a full time porter could be $30k or more per year. even though it is an average of lets say $35 per apartment, that is a 3% increase in common charges just for that.

My point is that you need to understand what is in the budget. Your lawyer telling you the numbers add up are meaningless. I am an accountant and i can tell you the budget added up in my offering plan also. The issue is more towards understanding what it takes to run a building. And I can tell you i did not think twice that there was only one porter in the plan, however after living in the building for a few months, I could see the need for potentially having a second one. This is also before any other changes that the owners may want once we have control.

Mikev- thank you for the honest and sober assessment. What magicman (?broker) doesn't mention is that their offering plan initially had a full time doorman and part time porter - but now they've reduced the services to part time doorman. There maybe a "W" next door, but the residents will not be left the feeling of being overserviced from what I can gather. So the starting point of $1300/mo as the reduced common charges (not even including real estate tax here) CC in face of rather incomplete coverage of the building seems amazingly high. There's also the issue of maintenance charges of $16K per year starting the 2nd year for airconditioning maintenance - that add an additional approx $350/mo added to the CC starting the 2nd year. For harlem, this is way out of the norm. from every other building I've seen.

Yes I was aware that the building will have a part time doorman and that is what is helping to reduce the high common charges. However, residential tenants will always be able to access the hotel entrance which will always be staffed and have a key card entry to the residential elevators that hotel guests will not be able to access as they will have separate elevators that only go to floor 1 to 6 which are the hotel room floors.
Stillfuzzy I was wondering if you can tell me where you found out about the air conditioning maintenance charges that kick in in year 2? I was surprised to hear this especially given the building will have a healthy reserve fund in the beginning which is unusual for a new development.

I don't know how common charges like these can be even considered? They have been reduced only because a major service has been cut: the doorman will be part time. The amenities just do not warrant such high charges and it has nothing to do with Harlem. These would be high anywhere in the city. And even high for a co-op, which this is not. This is just the starting point as well...they will just go up and not down. Something just does not add up.

Uptowndude, no offense, but I sense a little animosity. I recently purchased here, and think bar-none it is nicer than any other building I looked at in the area. The finishes and quality are by far superior. Not to mention the price per sq. ft. is much less than these other buildings. I purchased a 2 bedroom condo that is significantly larger (by 300 sq. ft.) than the building to its left (I won't mention the name)and it was priced $120,000 less! And how is going from a full time doorman to a part time doorman cutting a MAJOR SERVICE? When every other building I visited in the area and going further south down FDB has a part time doorman as well. I read the offering plan, as did my attorney and the budget in the offering plan Split up only between 44 homes makes sense. personally I don't want to be in a building with 80+ neighbors, having only 8 neighbors on my floor and 44 in the building suits me just fine. Plus the amenity of a hotel where my friends and family can stay while visiting is a win/win for most. If you can't afford the common charges, simply do not live here. In the meantime I'll be enjoying drinks down at the WXYZ bar.

I totally agree with Schmoozie. I signed a contract for a 1-BR after looking at all the new developments in the area. None of them can compare to the Apex in quality, location and value. My lawyers also reviewed the common charges math. They are higher than usual because the building has only 44 units.

They're continuing to lower the common charges. They're currently at $1.05 per square foot, and the offerer will subsidize 25% for 5 years.

That seems in-line, and I'd be excited to see a reserve larger than the mandatory 10%.

The building's bigger problem though, in my opinion, is that they're going to have to work hard to get Fannie approval, because half the space is taken up by the hotel. This requires a special exemption, and probably can't happen until the building is close to full. The offerer is also lending, but that could skew the economics in a bad way.

And the list price for parking in this building is a whopping $75K. Anyone have data on how much spots cost in similar buildings? I was expecting a 50K list, and that they would come down from there...

BTW, on the issue of the 15 year vs. the 25 year tax abatement, from what I've been told by realtors, it's now only possible to get a 25 year abatement on buildings where there are units set aside for affordable housing. This apparently changed fairly recently.

Having now read the offering, another reason why the common charges are high is that Heating and A/C are covered. This is because the place has a true central air system. Most of the other buildings I've looked at, including 2280 FDB, have PTAC units and don't cover the cost to operate, so add in that monthly bill.

Additionally, the budget has a healthy budget for repairs and maintenance beyond the cost of the super and the reserve fund. For a 2BR apartment, I'd estimate that's an extra $50 a month that's basically going into reserve, waiting for some future capital cost.

Anyway, the common charges seem good now that I've looked at everything. The budget actually seems realistic, so I wouldn't anticipate special assessments or a quick rise in the monthly charge.

> from what I've been told by realtors, it's now only possible to get a 25 year abatement on buildings where there are units set aside for affordable housing. This apparently changed fairly recently.

great info, can anybody say whether this is true? don't tend to trust realtors that much

Yes, here's a link to some info on NYC.GOV: http://www.nyc.gov/html/hpd/downloads/pdf/421a-FAQ.pdf

@MidTown .... Good fact finding. When I have asked several agents at buildings that have the 25 year abatement, I've always received the answer of "I don't know", glad you have posted this to confirm what I already knew/suspected. They also don't tell you that you are subsidizing some of the affordable housing owners common charges. A friend of mine who purchased in a 25 year abated building informed me of this. I personally do not want to participate in paying for someones home, when I am paying full price for mine. It just doesn't seem fair. I'd rather have a 15 year abated building and have everyone in it paying full market price's on their apartment and common charges like I am.

"And the list price for parking in this building is a whopping $75K. Anyone have data on how much spots cost in similar buildings? I was expecting a 50K list, and that they would come down from there..."
I bought at the Douglass and own an indoor space for about 70% less than that. $75k is nuts.

Glad I could help. We did end up going with the Apex, though the abatement wasn't much of a factor. It's just that the building is so nice, and so cheap for what you get, especially when you consider price per square feet.

The common charges were the only issue for us. It's interesting how they resolved this. They said that the offerers are in the process of re-filing the offering to get the charges down to $1.05 per square foot, then they are subsidizing 25% for 5 years. But, they can't put the $1.05 in writing for legal reasons until the state accepts the revised offering. That bothered me, because what if they don't do it?? So what they ended up doing is giving me an out on the contract. If the common charge doesn't get moved down by a specific date, we get to back out of the contract. And, even when they do lower the charge, we get to decide whether we want to back out.

All my interactions from them have been good and seem to be above board.

Other things they have said-- they had a couple of minor things to fix after the last inspection for them to get their temporary certificate of occupancy. They've addressed them all, and someone else should be coming out in the next couple of weeks. They've currently got 4 units under contract, and have 3 more agreed offers, where they expect the contracts to be returned this week. And, they're negotiating on two more units. While they only need 7 accepted offers to start closing (15%), they probably will wait until they have 11 (25%).

MidtownWGeek- when will you be moving in? When do you think they will close?

MidTownWGeek's link only applies to buildings that started construction after Dec 29, 2007. Prior to that, most areas in Harlem were eligible for the 25-year exemption as-of-right. It had to do with whether the property was located in a district that had, at some point in the past, been designated for a publicly subsidized mortgage insurance program. Not sure why this building would be 15 year though.

Freestyle36: I expect it'll be about 60 days, give or take about 15 days.

In other threads, people still seem to be concerned with the common chargesl despite the $1.05 plus subsidy that seems to be coming down the pike.

Some people think this still seems high relative to other buildings in the area (except 88 morningside which is relatively higher due to the land lease), but you have to do an apples to apples comparison. First, the heating and air is rolled into the common charges at Apex, because it has true central air. All the other buildings have PTAC units, which are not rolled into the common charges. So you need to control for that, since it's a bill you'd have to pay at any other building besides Apex. And, you will also have those big ugly things hanging off your walls, too.

It's true that, since there are about 1/2 the units in the Apex as in nearby buildings, the unit's share for employee expenses is higher (e.g., doorman). But, for an average unit, it would be about $100 a month more (less for the small units). Over 30 years, it would cost you $36K (not adjusting for inflation). However, Apex seems to be priced at least $50 per square foot less than other buildings, maybe more like $75. So if you're buying 1200 sq feet, you're saving $60K up front, so far more than you're ever going to end up paying in extra salary.

And if anything ever happens to the building (e.g., the roof needs to be replaced, or the outside needs work), the responsibility is shared with the hotel-- they are responsible for 49%. It's just the condo-owners-only expenses that the hotel doesn't share.

I should say, depending on the PTAC unit, the heating might be covered in the CCs for other buildings. But, there's no expense at this building you wouldn't have somewhere else in some other form, whether rolled into your common charges or a bill you pay yourself. There's no land lease or anything like that.

Therefore, the larger common charges will boil down to some additional employee expense you bear for the doorman, etc. Expect that to be a net $100-200 a month difference. That difference is very much offset by Apex units being so much cheaper.

If there's any other material difference, expect that the more expensive building will have more going into reserves and/or will be less likely to increase charges in the future.

So I finally managed to research what stillfuzzy mentions in his post "maintenance charges of $16K per year starting the 2nd year for airconditioning maintenance - that add an additional approx $350/mo added to the CC starting the 2nd year." What stillfuzzy failed to do with his math is divide the $350/yr not month by 12 months. This comes out to about $32.00 per month. Not anything obscene by any means. So it seems stillfuzzy is well..... STILL FUZZY. Lol. $16,875/44 homes = $383.52, $383.52/12 = $31.96 per month.

And, if the air conditioning maintenance turns out to be mostly an unnecessary expense in Y2 as expected, a lot of that money will just be bolstering the reserves. Oh, and remember the 25% discount through year five.

Hey MidTownWGeek I've been watching your post here and in other threads. Completely agree with your comments about the building, particularly compared with the others in the area (2280 FDB, 88 Morningside, etc). I went thorough a similar analysis and ended up signing a contract as well. I think this place will sell pretty quickly once people find out what the actual common charges are with the reduction and the buy-down (ours are almost less than half of what is advertised on this site and I thought the sponsor was pretty reasonable during negotiations). A smaller building, no subsidized apartments (421a), central air, location and the gym equipment (even the colors) were all pluses for us. I didn't think that the appliances and some of the finishes were as nice as 2280 FDB (Miele/Viking vs. Kitchenaid, etc.), but that is pretty much the only advantage that I think 2280 FDB had (yes the common charges are slightly lower, but add gym membership for 1-2 people in 2280 FDB and that difference is gone -add a parking spot and the math gets even worse).

I am a little curious about what you were told w/r/t moving in within the next 60 days. We were under the impression that we might not be able to move in until this summer. . .

In any event it looks like 7 apts are now clearly in contract, so we aren't the only ones that came to the same conclusion.

Shadow: Your comment doesn't seem to have officially shown up yet, but I got it in my email. Looking forward to having you as a neighbor!

What they've told me is that they have two things that need to happen before they can start to close:

1) They need to get the TCO, which they think will happen very soon, it's just a matter of getting the inspectors back out.
2) They need to get to 25% under contract before most lenders are going to be willing to close.

Since they lowered the common charges, they've gotten probably one unit a week under contract. I know they're close on at least a couple more units. They should get to the needed 11 in February. About 10 days ago, I asked if I should lock in my rate-- do they think there are good odds of closing in 90 days? They said, "absolutely, lock in now."

Even if they go 60 days before getting to 11 units, they will then issue a 30 day notice, and I believe we can close any time in that 30 day period. So hopefully we should be in by the beginning of May.

CC r high for Harlem/part time doorman. Master bedroom 11x16??? Say goodbye to your king size bed if u want room for anything else in your bedroom

jakedavid: My Master is more than big enough for a king, two dressers and two night stands. I'm sure it depends on the floorplan-- 11x16 is more than enough if there is a long wall with nothing on it and no doors next to it.

And, as Shadow said, the CC are actually about 50% of what they're advertised to be, so clearly people who are going and looking aren't finding them high any more, which is why they've all the sudden gone from 0 to 7 in contract.

I just got the ratified amendment (has cleared the Attorney General's office) that covers the reduction of Common Charges. They're now at $.755 per square foot with the 5-year subsidy. The unsubsidized rate is $.932 per square foot. That's very far down from the original price of $1.44 psf (which is still indicated in the listings).

They now have their TCO. They're about to declare the offering plan effective. Closings will probably start this month.

Thanks for the udpate...and good luck with your closing.

So what are the final CC? Is the 1349 on the 3 bed correct?

That's right with the subsidy. For the 3BRs (two of which I think are already occupied):

12E, 1,809 sq ft, $1,348.98 per month
12C, 1,715 sq ft, $1,281.53
10C 1,699 sq ft, $1,281.53
9F 1,810 sq ft, $,348.98

WOW, what do you get for that? Is the parking for sale or rent?

Seems like a lot given no private outdoor space and you share your home with a hotel. The hotel should subsidize the owners, not the other way around.

Some of the units do have private outdoor space, e.g. 10C. Common charges are definitely reasonable, if not as cheap as buildings with twice as many units. See plenty of the other discussions under this building for more details (e.g., the central air being covered, which is not part of your maintenance in neighboring buildings). The hotel DOES pay about half of all common charges for things that are common to both the hotel and the condos, and there are plenty of perks to being above the hotel.

But reasonable also factors in the sales price. For example, consider a 2BR apartment on the 9th floor, with a southern exposure and great views of the city at the Apex (which is what I bought).

Yes, I could have saved $200 in common charges a month at 2280 FDB for something comparable: a 2BR 2BA, 1225 sq ft apartment on the 9th floor with a tiny balcony (and I did not want a balcony). I would have lost 100 sq ft, lost my great view of the manhattan skyline, ended up paying more in power because of the HVAC costs not being in my common charges, would be sharing a building with subsidized units that can easily access my floor (hotel has separate elevators and entrance). And, I would have paid at least $250K more. The only things that look better in that equation are the 40sq ft balcony (and then, not to me), and a meager common charge reduction. My common charges could be significantly higher, and I'd still think it was a good deal.

The other advantage to 2280 is the 24-hour lobby attendant. Apex currently doesn't have one from midnight till 7am. At some points in the day there are 2 people there, though. I suspect that they may look at one person around the clock for the same cost. And even if not, I am not too concerned with the off-hours-- a virtual system is fine. The virtual doorman thing they do have does indeed have video.

All in all, we weighed the financial factors VERY heavily in our decision. But you have to look at the whole picture, not fixate on one number.

In general you do not want socialized 'HVAC' or energy costs, people waste and end up costing everyone more.

If the hotel goes out of business how would that impact the condo owners in the building? Are there any protections in place?

ms123: The costs are predictable-- the common charges are designed to more than cover it.

looking_up: It wouldn't affect the condo owners much. There are very few common elements that are a shared expense. I can't think of anything, actually.

I'm sure if Starwood didn't want to run the hotel anymore, they'd either sell the hotel to another hotel, or to someone who wanted to convert it into condos or rentals.

However, I'm not particularly worried about Starwood pulling out of the place. The company I work for is now is using it as a preferred hotel in NYC. It's usually tough to get a room even a week in advance-- same day has only happened once, when there was a last-minute cancelation. They're not having any problems at all keeping the hotel fully booked.

We are considering to purchase an apt in this building.
We understood that the common charges are subsidized for 5 years at .755 $/sqft.
What about the Tax Abatement for 15 years? is it active already now?
thanks

potentialbuyer111: The tax abatement started on first move-in or close to it, so end of June or so.

Thanks fot the quick response.
We heard that the tax abatement now is for 3 years, for building the building, and will expire in 1 year.
Is there a 15 years tax abatment for the residential units, and when did it start?
thanks

We heard that today there is a tax abatement for 3 years, for bulding the building, which ends somewhwre next year.
Is there a tax abatement for the resudential apts for 15 years, and when did it start?
thanks