Rent for $20K or buy for $5.4M

Cap rate of 2.5% despite a “low” purchase at 12% below ask.

If you bought 1008 for $6,650,000...

… your cap rate would have been 2.0% at purchase. But the good news is that it’s now 2.5%, after we mark the trade down by $1.25M.

No views

Is this a price reduction?
https://streeteasy.com/building/the-chatsworth/sale/1660848
DATE PRICE EVENT
6/27/2023
$4,900,000
Price decreased 9%

5/30/2023
$5,395,000
Price increased 23%

5/30/2023
$4,399,995
Price decreased 23%

5/5/2023
$5,735,000
Listed by Brown Harris Stevens

11/11/2021
$4,995,000
No longer available

8/12/2021
$4,995,000
Temporarily off market

6/19/2021
$4,995,000
Price decreased 9%

4/30/2021
$5,500,000
Listed by Brown Harris Stevens

6/16/2016
$5,450,000
No longer available

11/18/2015
$5,450,000
In contract

11/17/2015
$5,450,000
No longer available

6/23/2015
$5,450,000
Listed by Corcoran

6/18/2015
$5,450,000
No longer available

4/24/2015
$5,450,000
Price decreased 9%

4/14/2015
$5,965,000
Price decreased 3%

2/5/2015
$6,135,000
Listed by Corcoran

lol

So if you like the 08 line..
You can own it, on the 5th floor, for $5.85M (with $8.8k maintenance).
Or you can rent it, on the 10th floor, for $20k, lol.

The fact that the maintenance, on initial sales, is already 44% of attainable rent (worse actually since
we compare 5th floor buy to 10th floor rent) is bad.

It's a small enough building that staff salary growth is going to crowd out the rest of the budget.