24 W69th occupied 6-room apts

Looks like the cockaroaches are trying to get out bf the Raid bomb... $6MM... flmaoz....

Oh crap, are you saying that it's 5x6 rooms? well well... come to papa.... I gotta call my actuary guy... get me some numbers, get me some health reports... maybe I'll live in one and chk on their health every day.... FLMAOz.....

BTW, someone who's owned them for 30 yrs... finally got religion.... do you think maybe.. the sellers see something to unload this year versus the 30 prior years?

It's not worth 6m. 1m?

no, bc you have to negative carry it. The in price, mortgage, cc minus any "rents" would still put you in the hole month after month.... so you NEED ppl to die quickly... it's the most morbid of NYC RE investments....

The only reason seller continues to fund it is bc they are in for zero, their rents minus cc nets them $1MM/month... SO WHO IN THEIR RIGHT MINDS wanna pay to take over this nimrod's monthly cash flow with balloon "investment"?

BTW, the headache for dealing with these $500/month renters is ENORMOUS... you think you've seen crazy business dealings? NONE LIKE RS/RC tenants..... I knew of one family, where the kid slipped and fell in a RC/RS apt, a classic 7 on WEA, the tenants sued the LL for $200K and won $100K.... SERIOUSLY... they fking WON... and LL was on notice to FIX every FkING TILE....

Sure, but it's not worth NOTHING.

negative carry with no known end date and therefore no exit strategy could actually be worth nothing.

what is a company worth that loses 100K a year and can't cut overhead nor raise sales and is hoping that its competition dies off (literally) before some outside event makes things worse?

I wonder if it is negative carry.

well, they say $13 K a month in maintenance; how much do you want to add for interest? say you buy it for $3 million (which of course you won't but what the hell). $2.5 million at 6%? another 12 K a month. capital improvement, repairs? 5K a month ... way low i think but a starting point. so, 30K a month in carrying costs with $500K tied up.

not a good sign that they didn't mention the rent roll. could it be 18K a month?

cc---i know you're try to be kind in your analysis but, one thing's for sure, you wont find 6% money to fund this deal---

10023, it's almost 100% likely to be negative carry now. for how long is the question. and then you need to factor in the costs to renovate each unit.

and as 67th points out, rc/rs tenants can be a pita. some have even been known to ask for new toilet seats when the ones put in a few years ago fall apart.

Those toilet seats!

Teachable moment.

When you take on an investment that gives a negative return during the holding period with a hoped for ( but unknowable) big pot of gold at the end, that is
1) swell investment;
2) depends on your cost of capital;
3) final return based on how you can paint your investment at the end;
4) not a fking investment.

Hmmmmmmmm.

It's unlikely to be negative carry on a status quo, unmortgaged basis. even W67th seems to acknowledge that it's probably at least slightly positive: "...their rents minus cc nets them $1MM/month..."

Suppose everyone's right that these are all RC/RS tenants, even though this is not actually stated. On the surface, the MM is already quite high, at $2,536/unit per month. What could be in this number? My assumption is utilities are generally pretty stable, there's no doorman and barely any staff, and taxes are unlikely to have outpaced the norm IF the RC/RS assumption is correct. (If that assumption is incorrect, then taxes could be much higher, but then the rent roll looks way different as well.)

Seems the only thing that could have caused this to be negative carry is some major recent capital project or disaster that is still being spread across the small number of shareholder. That's possible of course. Agree with CC that it's odd they didn't reference the rent roll or clarify RC/RS/free market status.

Buying the Brooklyn Bridge on eBay from a Russian with -15 feedback named URA Suker
would be a sounder investment - .

When you take on an investment that gives a negative return during the holding period with a hoped for ( but unknowable) big pot of gold at the end, that is
1) swell investment;
2) depends on your cost of capital;
3) final return based on how you can paint your investment at the end;
4) not a fking investment.

5) pet.com
6) Google
7) a perfect chance for W67 to teach us that a prime UWS location is not worth even $150/foot just because some pesky elderly folks happen to live there... :)

Based on some preliminary research, the building has a "Chusid-Whitehead" mtge, I have yet to dig into the terms, but it's on ACRIS.

There are only 9 stories, but the highest floor is "10". Assuming there are 8 classic "6" apts (gnd floor diff.), 3 of them are not owned by the sponsor.

Looks like 2A, 3A, 4A, 7A, 8A could be the sponsor units.

Length of tenancy (minimum):
2A - 1962
3A - 1970
4A - 1972
7A - 1976
8A - 1978

Hmm, now I haven't done the research to see if there are any lineal descendants.

Maybe it makes me a fool, but I'd assume tolerate some amount of monthly expense for I don't know, 5 years, 10 years, and gamble on one of those units becoming vacant or someone being amenable to a settlement.

My suspicion is that at least one would not be able to easily assert claim on the lease and at least another would be amenable to a buyout :)

Back in the last meltdown I was offered large, prime UES 2-bd doorman coop
with roughly break-even rent for $10,000.

nyc10023.... the asking price amounts to $1.25mm for a classic 6 in prime UWS in unknown condition. Given the money it generally takes to get rid of RC tenants, I don't see the upside for a buyer. And we all know that the buy/rent math doesn't work out (after 3000 threads) unless you have significant appreciation. Sure, the location is prime, and that will help in downturns, but I don't see the upside at current pricing.

What is a classic 6 worth in that part of the UWS? I'd guess $1.5 - 1.8.

"BTW, the headache for dealing with these $500/month renters is ENORMOUS." True. I got war stories.

nyc10023: Why not go look at the place & get more info.

Re: RS/RC Ts: they have a right of succession, so, their nearest & dearest could live in these units for future generations & you may never regain possession. However, I'm not sure whether an "Owner Occupancy" proceeding could be done & if you can do OO, could be lotsa litigation, so you'd probly need lotsa cash for attorneys & buyouts.

But, I say call the broker & have a look.

What's it worth? Hard to say w/o more info, like, what is current cash flow of rents?
Also, see if you can research how much similar packages went for in the past. Maybe try Massey Knackle or other commercial brokers & see if you can find comps: http://www.masseyknakal.com/listings/index.aspx

"Teachable moment.

When you take on an investment that gives a negative return during the holding period with a hoped for ( but unknowable) big pot of gold at the end, that is
1) swell investment;
2) depends on your cost of capital;
3) final return based on how you can paint your investment at the end;
4) not a fking investment.

Hmmmmmmmm."

LOL! ,and 5) you own several other properties that put you in the wrong tax bracket and you want to maintain the shell company shuffle showing a loss in one place to offset gains somewhere else.
Keeping the property as a lottery ticket in case of major changes in RS/RC laws or "god forbid" a fire.

New upcoming climate for those with "wealth" and "not paying enought tax" may have this one being one of the first of many like kind properties for sale in the very near future.

"you own several other properties that put you in the wrong tax bracket and you want to maintain the shell company shuffle showing a loss in one place to offset gains somewhere else.
Keeping the property as a lottery ticket in case of major changes in RS/RC laws or "god forbid" a fire."

Not sure what this means, but I think it's a condemnation of rent regulation.

Not really, (and Im not against RS it has it's place and some form is necessary. RC though is ridiculous) it just means we are approaching times where risk/reward on LLs carrying RS/RC apartments for a loss are skewing much heavier to risk than reward.
It will reflect so in upcoming years with an exodus of ownership of these types of properties.

Walterh: no way the ask price is realistic. But unlike cc, if I could have it for 0, I'd have it. I don't think it's worth nothing.

This looks like a better deal. http://www.easternconsolidated.com/listingdetail.php?listing_id=723

I agree, truth. Sounds like the 70s.

take that listing & try to extrapolate.