24 Fifth Avenue Maintenance

Hi Jason (Bourne?),
The reason why the maintenance is higher is because 24 Fifth is a land-lease building. This means that the building does not own its land and has to pay a rent for it.
Feel free to let me know if you need extra info and I'll be glad to give you details.
Francois.

I almost bought in this building years ago.

I'm glad I didn't.

24 Fifth has a litany of its own unique problems and concerns. I'm sure someone else on the board can better elaborate than me.

Bottom line -- it's best to move on.

Yes, and that's putting it delicately.

It's a land-lease co-op, so you're buying only a share of the building, and the co-op pays rent to the Brodskys. It's something like 10% of the land's unimproved value. (6% is more typical for a land lease.)

As the non-purchasing tenants have vacated, the Brodskys have sold some of their apartments and rented out others at market rates. That, along with the co-op's liberal sublet policy, makes the building renter-heavy, which lenders may not like.

ACRIS is down, so I can't check the mortgages, but you might want to check out the financials before putting any time into an apartment.

Love 24 Fifth. Obviously it has issues: the building history, and those kitchens are what they are, and the market doesn't like land-leases.

That said, what a lobby, perfect location and smoothly run. You might want to talk to Ken Barkoff, a downtown broker who specializes in the building.

ali r.
DG Neary Realty

The last person you'd want to talk to is a BROKER who "specializes" in the building. He will strap on the rose-colored glasses and tell you only the positives (like how lovely the lobby is, its "perfect location", and how "smoothly run" it is).

As a non-resident owner who lived in the building for many years, I can say 24 5th is indeed a well-run building--excellent super and on-site mgmt. The sublet policy is not really very 'liberal'--it used to be but was changed in the last several years to a three-out-of-five policy.

The financials are solid. But yes, the maintenance is higher than average. And it's a land lease. That said, I've been surprised to see that sales activity in the building has risen and prices seem strong. It's actually making me consider selling my studio after all these years.

The building itself is gorgeous, and the recently restored lobby and updated hallways make it really shine. New gym is a nice plus. Location can't be beat.

Isn't that the building that's approximately 110% headshrinkers' offices?

Maybe aboutready knows.

Having done a little research, seems the probable driver of higher maintenance is land-lease payments. Anyone know the key terms of 24 5th's lease agreement? Expiry date, renewal option, rent increase schedule, etc..? Any idea if lease holders have an option to buy the land, or if the owner has expressed willingness toward such a transaction?

Bramstar, are you from CA?