Huge terrace - how much value?

dwell, and of your next three examples, two have been on the market since 2007!!!

The only fresh listing, the one for $4M+ is really reaching. Will be interesting to see how long that lingers, and lingers, and lingers. IMHO nobody with that kind of money is going to spend it there. It's called buying the elephant on top of the building, the most expensive unit in a building, or, in suburban terms, the best house in the neighborhood, which goes against all real estate wisdom.

"private roof terrace" ACCESSED THROUGH THE STAIR CORE!!! LOL

Must take off/put on our Louboutins just to enjoy that sunset cocktail

Though the terrace is really nice. Too bad they had to take photos of it in the snow, and not planted and blooming gloriously, (though I don't see too much evidence of planters, trees, etc.)

How about the lack of appropriate antiques? Not up to your standards.

No dwell, must worry about other people coming up to enjoy their cocktails on your "private roof terrace". Since it's a fire exit, it can be alarmed, but cannot be locked off.

I didn't check to see how stale the listings are, just looked for size. I agree it may be a bit of a white elephant, but some buyers really love big out door space. Like any property, it must be properly priced.

>How about the lack of appropriate antiques? Not up to your standards.

Amazing how columbiacounty can be bitter about just anything. Did you have to sell your antique collection to pay the rent after you lost all of your money in the stock market?

dwell, you do know that sidecars are the color of sunsets, right? Maybe not Jersey sunsets, but still!

rar2b: I generally focus on Downtown and the UWS so I don't know your building. I do know, however, that I had a similar unrenovated listing offered for rent a couple of years ago, and that the place has subsequently been offered for sale by another broker, and I think now it's on its third broker, and we are clocking a year or two without a sale.

The problem is that the terrace really is worth an additional $2mm (4,000 sf * 50% interior sf) but, as nada and others have outlined, most people in the market at $3.5 mm would rather have a fourth bedroom and larger public space than a basketball court.

So to price it, one needs to figure out how much to adjust that $2mm down. To do that, one would consider how much of a "trophy" it is, and to understand that, I need facts I don't have here:

how dog-friendly is it, how fancy your building is and what its lobby looks like, who else lives in the building, what the potential for renovation is. What the maintenance is on this unit versus other units in the building/area is a key part of the equation too. Finally, access is important (a roof terrace that is accessed from the living room? so are there exterior stairs? How nice are they?)

Finally, your parents' financial situation is important: this is the kind of property where dropping money on a reno pre-sale can probably create significant value out of the air; are they willing/capable of doing that? Postwars are so out of favor with the consumer you're trying to hit that the 8' ceilings probably need to be "architected" away.

Realize that you are taking about a very thin illiquid market with wild ranges of value. The one "buyer" that approached us when we had our rental listing was bandying about a number $2mm higher than the unit has subsequently been offered for.

Happily for you, this is one thing that brokers are good for, to evaluate unusual properties. I'm happy to come see and price it, but since I don't want to sell it I would want a consulting fee to give you a price opinion.

So you might first want to start with UES brokers who might want to sell it, because they'll give you price opinions for free. Because this is the kind of thing that even people in the field are going to disagree on, I'd bring in three people. My off-the-tops are Barbara Fox (head of small boutique firm), Jacky Teplitzky from Elliman (high-volume broker, UES specialist), and Kathryn Steinberg of Brown Harris Stevens (who normally markets much more expensive properties, but this might charm her).

ali r.
DG Neary Realty

rar2b - any input on the maintenance?

haven't we established long ago that the terrace's SF may be worth up to 50% of the PPSF of the interior - but that at MAX SF you can count for the terrace is 50% of the interior? So for a 1500 SF apt, you can only add the equivalent of another 750 SF of interior space, and price it as though its 2250. All that extra terrace ads nothing unless you have the right to build on top of it.

Jason, where in heaven's name did you get the idea that a terrace can only be counted at 50 percent of the interior space e.g. A 4000 sf terrace attached to a 1500 sf apartment only gets counted at 750 sf. Think you're confusing various valuation methodologies

It appears you also have to walk up the common stairs to get to this rooftop terrace (which has been on the market forever). I'm not sure why they didn't add stairs from the residence??? - http://streeteasy.com/nyc/sale/528258-condo-235-west-71st-street-lincoln-square-new-york

The listing says there're stairs in the apartment's front hall. Maybe they forgot to fix the floorplan. It's pretty much the same as the other full-floors lower down.

In general, roof terraces (e.g. up a flight of stairs from the main interior space) is a PITA, unless you can build a sort of "summer kitchen" up there, complete with refrigeration, sink(s), storage for barware,dishes, etc. as well as the standard BBQ and plant stuff.

And dumbwaiter

right alan - either mechanical or human would be a great help. (okay, sue me, I just couldn't resist).

Yeah, alan, not all waiters are dumb.

actor jokes ... !

a 4000 ft terrace is a liability when attched to a 1500 ft apt---might even be worth less to me than were it a nicely configured 750 sq ft--i mean, the perimeter of the building, where the view begins is miles from one's window's and whatever doors there are--kills the view

"If terrace-free comps went for $1.5M, and I saw this listed at $2.5M, I wouldn't be surprised. If it were listed for $2M, I'm guessing you'd have a contract with newbuyer99 within a week."

inonada, thanks for the shout-out. I had to laugh, because up to your comment I was actually reading the thread with interest precisely because an apartment with a large terrace on the UES for $2MM would be perfect for us. Unfortunately, 1600SF is just too small - we are looking for at least 1800 and prefer 2000+

The other thing is that for us there's vast diminishing returns for a huge terrace. I'd MUCH rather have a 300SF terrace than a small balcony, but my preference for a 1000SF terrace over a 300SF one is only marginal. I want a place to hang out, grill, have a table and chairs - a basketball court or a football field does very little for me. What exactly will you do on a 4000SF terrace that you can't do on a 1000SF terrace? And how often? And how much utility will that bring you?

I am guessing, but suspect many other buyers think like me, especially ones who are in the market for a 1600SF apartment - consistent with what other posters have pointed out.

In other words, if your parents magically traded 3000SF of your terrace for 600SF of interior space (leaving 2200SF internal and 1000SF external), we'd happily pay north of $2MM for your apartment, even if we had to do a significant renovation.

Here's another way to look at pricing. We have a terrace that's probably 500-600SF right now. We rent an apt with about 1200SF interior. My estimate of the "premium" we pay for the terrace is probably $500/month. Very roughly, that $500-600 / month of additional mortgage would buy you $100-150K more in purchase price. is your parents' terrace worth at least that? Absolutely. Is it worth double? Maybe. Triple? Possibly. More than triple? I really doubt it. Precisely because (like me) most buyers that have $2MM instead of $1.5MM to spend would rather spend that extra $500K on extra interior space, not on wastefully massive outdoor space.

Oh, one other thought - someone mentioned the subway construction. Is your parents apartment on 2nd avenue? If so, I think the terrace's value is greatly diminished because for the forseeable future you will very rarely get to actually use/enjoy it.

"Jason, where in heaven's name did you get the idea that a terrace can only be counted at 50 percent of the interior space e.g. A 4000 sf terrace attached to a 1500 sf apartment only gets counted at 750 sf. Think you're confusing various valuation methodologies"

From about 20 different threads on this topic in the past. And from many experts saying so. Here is Jonathan Miller saying so, fucktard:

http://matrix.millersamuel.com/?p=8015

Miller's exact quote:

"oversized space – if the terrace is greater than 50% of the interior space, the ppsf contribution falls off considerably for the additional space over the 50% threshold. For example 700 sq ft 1-bedroom apartment with a 3,000 sqft terrace – only about 350 sq ft has any meaningful value (of course, if the maintenance charges reflect the entire terrace, any value of the terrace would be wiped out."

wbottom - aside from the fact that you are not the buyer for any space of this size with a terrace, I do agree with you (and I hate to do so) that a terrace of this size attached to a 1,500 sf apartment is a problem - NOT because of views, but because it is sort of the tail waggimg the dog. Amd, a terrace of that sizs becomes a major commitment of expense (labor and love) to make the damned thing look good. I know, with terraces a whole lot smaller, what I spend every year on plantings, labor, etc., (and I do much of the labor myself), forget the trees and shrubs which are already in place). And to have a "concrete" terrace - doesn't look good. Terra cotta tiles, or some sort of wood terrace flooring is definitely required. And for a terrace that size, just the landscaping is major, major money, which I don't think someone buying a 1,500 sf apartment will necessarily envision spending, when they will also have to renovate the apartment itself.

I see this as selling at about $2M, (with perhaps an initial ask of about $2.2. Ask a lot more than that, and IMHO, it will sit, and sit, and sit.

The OP A(and his/her parents) obviously had a good time out there, on the vast open space, but prospective buyers will look at that and ask "how much will it take to make that look good"?. Especially when the apartment sounds sort of generic.

I know it is smaller than you want, newbuyer99. However, would you bite at $2M? Would giving up 10-20% of your desired interior space for such a unique and great exterior space? You just might: re-envision what you'd do, etc. If not you, the next guy. At $2.5M, it takes someone who's looking for this sort of thing exactly. At $2M, someone will replan what they want.

Rar2b In the Offering Plan the the sponsor determined premiums for different attributes such as floor differentials, balconies and terraces. In a coop each unit in the building was allocated shares based on size and attributes.

What was the premium allocated to your parent's unit in the offering plan? Take the premium allocated in the offering plan (depending on the year - probably 80's when most buildings converted) and multiply it by the amount prices have increased from the original sale prices to today's prices. In other words what were 3 bedrooms selling for in the plan? and what are the same units selling for today?

Another evaluation tool in a coop is price share. The unit with a terrace should have more shares than the same 3 bedroom with out a terrace. What is the price per share units in the building are selling for?

All evaluation methods are just approximations. There are many variables that have already been mentioned on this thread but in my opinion it's best to compare apples to apples.

Mitchell Hall
The Corcoran Group

I get the dimishing returns as the size of the outdoor space goes up. But, I think no matter the size of the apartment, there is a minimum size that still contributes to the value as long as the maintenance doesn't kill it. The above example about a 700 sq ft apartment with 3000 sq ft outdoor space makes sense. However, I don't believe the 50% of indoor space applies to a smaller apt like this. I would much rather have 500-700 sq ft of outdoor space than 350.

mjHALL, why would the arbitrary original share/offering allocations determine (or even hint at) the current market price? Those methods are good only in determining whether the CC/maintenance/tax is high enough to suppress value.

The 2nd ave subway construction is not a factor where this building is located. I know I owe everyone maintenance data - I am trying to get my hands on this asap.

In any event, I do appreciate everyone's comments. This has certainly been an educational experience for me.

The key takeaway I get from all of this is that at a price of $2.5mm, the buyer universe may be very limited given the smallish size of the interior space, but it is possible that there is a perfect buyer out there who really values the outdoor space and would pay the premium. At $2.0mm, I think this unit would sell extremeley quickly. I think anything less than $2.00mm is too low.

rar2b, I think you have a good understanding of the discussion so far. The maintenance is an important element. At a certain point, it becomes so high (relatively to the indoor square footage) the place can be a bit of a white elephant.
You'll need a broker who has a solid idea of who your buyer is going to be, before they even list the apartment. That means someone who understands the building rules, the demographics and the income/wealth profile of the ideal buyer.

Depending on the maintenance, I'd argue that the value of such a large terrace could be as low as $0 or perhaps even negative. E.g., outdoor space in my building is assigned a share value correspoding to 50% of interior square footage. We have one unit with larger outdoor space than indoor space, and their maintenance is crippling. This unit, despite being more renovated and having a more favorable exposure, actually sold for 5% LESS than the identical unit without a terrace, six months apart. The maintenance was off-putting to most buyers, and the people who eventually bought the unit are independently wealthy and use it as a pied-a-terre.

lad- you've posted on SE about adding a roof terrace to your apartment. Won't that significantly increase your maintenance? Or were you able to somehow swing a favorable deal.

rar2b, I think your pricing sounds very much in the ballpark.

alanhart, Prices in a building usually move in sync proportionately in percentages as does maintenance and common charges. Manhattan in general and neighborhood to neighborhood and coop and condos move in averages and median prices. Most developers/sponsors priced apartments to sell. The positives and negatives of each unit factored into the prices. I don't think original prices are arbitrary.

The maintenance is an important element but it's also relative to the market because maintenance in a building moves up in sync too. Unless the building's maintenance increased much more than comparable buildings if it's very high today it probably would have been considered very high back then too compared to similar units. High maintenance would be reflected in sale price. The maintenance has to be compared to similar buildings with a similar unit with a similar terrace.

I bought a new construction apartment in 1989. The current sale prices in my building have pretty much moved in sync proportionately in percentages based on the original premiums excluding renovations, conditions and other variables.

inonada, to answer your questions:

"However, would you bite at $2M? Would giving up 10-20% of your desired interior space for such a unique and great exterior space?" I haven't seen the floorplan, but I don't think I would bite at $2MM. 1600SF is just too small, regardless of price, outdoor space, other attributes.

"If not you, the next guy. At $2.5M, it takes someone who's looking for this sort of thing exactly. At $2M, someone will replan what they want." Making the (huge) assumption that the maintenance is not a killer, then I agree with this - at the right price. I also agree that, based on what I've heard, $2.5MM is not that price. $2MM well could be that price, but I am not at all sure. If the "right" price for the apartment without the outdoor space is $1.5MM (which we also don't know for sure, I recall that was just the listed ask, not a closed deal), $500K is still a huge premium to pay for outdoor space, in absolute dollars. Even for a 4000SF outdoor space.

It's very possible someone will pay that $500K premium (or more), I am just less convinced than most on this thread that it's a no-brainer. And I am a huge proponent of terraces.

ph41, we are adding a roof terrace and are (unfortunately) bound by the same share allocation formula. Our apartment is larger, though, so the ratio of indoor space to outdoor space is about 3:1, whereas it's less than 1:1 for our neighbors.

We were also careful about what roof space we bought. Of what was available, we bought the most usable 2/3 and excluded the 1/3 that wasn't as functional due to odd corners, proximity to mechanicals, etc. The other terrace was present at conversion, so there wasn't the same opportunity to pick and choose. I'd estimate that only about 2/3 of their outdoor space is actually usable, again due to an odd shape, mechanicals, etc., but they're stuck paying maintenance on the whole thing.

http://www.nytimes.com/2011/04/24/realestate/24cov.html

hey rar2b, where did you go? time to provide the maintenance data already....

If it's too huge, sometimes it just hurts. To all the ladies I've hurt, it's your fault for not being ---------- enough.

columbiacounty
about 8 weeks ago
ignore this person
report abuse You idiot.

This is hfscomm1

Your entire contribution to this post and any other you ever comment on.

Huge terraces are not for New Yorkers because if you have the money it is better to get a place out of New York City to spend the weekends.

Huge terraces are not for New Yorkers because if you have the money it is better to get a place out of New York City to spend the season.