Sunday, March 2, 2014

The Final Chapter in the Saga: 71 Irving Place






This is the story of a huge corner building in Clinton Hill, the wanna-be's who thought they could low-ball it, the developer who thought he could sell it himself, and the Corcoran open house that sold it in a flash.  Yeah, we tried to tolja' about 71 Irving Place almost 3 years ago, when it listed for $1.195M, then dropped to $975K.  Buyers with millions in the bank moaned about how much profit they could make, "Would it be enough?"  Buyers who claimed to be design geniuses were boggled by how to reconfigure this huge 24' x 53' building with windows on all sides, which is so simple to do it's almost impossible to go wrong.  Which is it, huh?  Are you a design genius, or is this perfectly blank canvas just too perplexing for you?  You can't have it both ways.  If you can lay-out a 16' x 40' rowhouse that's attached on both sides, we're pretty sure you can figure out this puppy.  The real developer buyers certainly did...











Would-be buyers complained the location was "the hood", because they're obviously too good to do a development on the same block as Vinny Chase's house.  He, like most of you, was priced out of Fort Greene too.  But he also, unlike many of you, got religion in time and picked up something in the next door neighb':  Clinton Hill.

Yes, when the original deal in the fall of 2011 fell through on 71 Irving Place, we had handfuls of people back in the house when the price got as low as $700K-$800K in the spring of 2012.  Instead of the price going up, the owners were dying to do a deal ASAP at an even lower price.  Imagine that!  Was that good enough for buyers?  You would think, right?  What more could opportunistic folks ask for than capitulation??  This was their time to shine.  Buyers who puff up their chest and love the feel of their heels on a seller's throat finally had just what they were looking for here, right?

Well, the wanna-be's complained about condo comps and tried to steal the building at a level even lower than the already-discounted price.  Buyers who can't take "yes" for an answer can't be satisfied.  You bring them a property listed at $4.5M that will do the deal at $3.5M, and instead of saying, "Wow, great!  That's $1M off!" they get too cute and wanna steal it for $2.5M.  The glass is already well over half full, but all they can see is what's empty.  Buyers who bragged about buildings of theirs throwing off $60K month were trying to fight over $50K on the purchase of 71 Irving Place.  Back then, nobody wanted to pay even $200/sqft for this piece, while even the dinkiest condos were fetching well over $500/sqft.  Guess what?  Nowadays simple, modern condos across the street are closing for over $900/sqft, like 82 Irving Place, #6A.






The buyers, however, weren't the only ones playing games at 71 Irving.  The listing brokers received a cash offer in writing from a proven developer that was $50,000 higher than the $750K they closed for in 2012.  Perhaps there were shady reasons why the brokers took the lower offer (most likely because the high offer came from a buyer's broker - which means splitting their commission in half), but they could always hide behind the, "Well, the seller was burned on the last deal..." excuse for why they went with a lower back-up offer and net themselves more while netting their seller less.  Either way, the deal was a steal and despite the brick collapsing on one side, there was plenty of meat on the bone for a profit.  Even the basement cleaned up nice...





The roof deck was another no-brainer...




The developer's pictures were too dinky and their website too underground, but you slap this shiny listing on Corcoran.com and then the Joe Public retail buyers can finally get their heads around it.  They listed for $2.5M and are now in contract, supposedly for $2.4M.  You can shock & awe over that whole-dollar price, or you can realize that it's still under $500/sqft - which is almost half of what that condo across the street cost, and the same price that people pay for houses over here that need a gut reno, not ones that just completed theirs like 71 Irving did.  Novices will still see the on-paper leap from $750K to $2.4M as some kind of speculative bubble, although this is more than just on-paper, y'all.  This ain't Bitcoin; this is brick and mortar!

This is just one of two houses certain wanna-be buyers dropped the ball on for under $800K that year, which are fetching $2M+ in today's market.  Can't wait to see the look on their faces when the next one hits the market soon!



Pro's:  huge corner, windows everywhere, decent renovation, roof deck, under $500/sqft, among the best of breed for this price, perfectly sleepy but well-situated location

Con's:  woulda/coulda/didn't for dozens of developers, not in everyone's budget on the retail end, not everyone's favorite renovation, listing brokers pre-flip took less money for their seller in order to net more money for themselves

Ideally:  we can't imagine where this could've gone if an even more polished developer got their hands on it.  Just goes to show what "good enough" can get in the top locations.


5 comments:

  1. Good post,

    But i still do think it is unfortunate and not really fair that they did not accept the higher offer just not to split their commission.

    Their job is to get as much money for the seller, and it is easy to be on the other side "seller broker" but i do not think it is fair for the buyer broker...

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  2. Couldn't agree more. We see it happen every week though.

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  3. i love how people loose when they get to greedy

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