“Includes Parking” (Sort of…)
Property Spotlight – On the Market
- VALUE ALERT – Five Amazing Back Bay Co-Op Opportunities
Well Bought/Well Sold
- 257 Commonwealth Ave, unit 3 – The Back Bay Clearing Price – Well Bought
- 197 Commonwealth Ave, unit 2 – A Rare Back Bay Bidding War – Well Sold
“Includes Parking” (Sort of…)
“Includes parking” – these words are the holy grail for urban real estate marketing. Off street parking is hands down the most coveted amenity in our market, but like everything else with real estate, the devil is in the details.
In new developments, what is often passed off as “deeded” parking can be deceptive, and expensive. Most of the parking for unit owners at 1 Dalton Street is under long term lease with the Christian Science Church and located in a garage below the Church’s reflecting pool.
To better understand the parking arrangement, it’s fully described in the Parking Easement Agreement between the developer and the church, but have a bottle of aspirin handy, because the Agreement is 48 pages long. If it takes 48 pages to explain where your car will be parked, it’s probably a pretty good idea to understand the Agreement.
Under the terms of the Agreement, the fee for “parking rights” is fixed at $500 per month for the first ten years (which has about seven years remaining) at which point it resets to the then current market price every five years. There is an additional $150 fee for the valet service for a total of $650 a month.
It’s the same basic story at the new Raffles condominium development in Copley Square. The developer there scrapped their planned onsite parking in favor of leasing parking around the corner at 131 Dartmouth Street. It didn’t escape our notice that the Raffles parking lease provides for 107 parking spaces to accommodate 146 condominium units and 154 hotel rooms – perhaps they have deals with other garages in the area.
Deeded Parking on Beacon Hill
On site parking is almost unheard of on Beacon Hill, so the next best thing is owning a parking space at either the Charles Street Garage or the Brimmer Street Garage. You can expect to pay $350,000 for a parking spot at Charles Street, and the last recorded sale at Brimmer Street was $465,000. It doesn’t end there, the condominium fees and taxes at Brimmer Street will set you back nearly $600 a month.
There are some rental spaces available from time to time at Brimmer Street. A client of ours recently rented a space there for $700 a month. We’ve done the math (you can do this one in your head), it makes absolutely zero financial sense to own vs renting.
Terms like deeded, assigned, and “includes parking” are used interchangeably in the marketing process, but the differences are very meaningful. In a buyer beware state, like Massachusetts, it’s critical that buyers understand what they are actually buying – before they make an offer on property.
Batterymarch Group is focused on buyer representation, so the highlighted listings are not ours. These are our opinions, so take them with a grain of salt. We’re happy to set up showings of these properties, offer our valuation analysis, and assist with preliminary renovation budgets when needed.
VALUE ALERT – Five Amazing Back Bay Co-Op Opportunities
There are currently five co-op apartments for sale on Beacon Street in the Back Bay. With the exception of unit 7R at 274 Beacon (which was nicely renovated after it last traded in 2016), they all are in need of updating in our opinion.
These properties, which would have sold relatively quickly just five years ago, are being overlooked by the market place for several reasons:
- First, buyers are being lured into new construction in less traditional neighborhoods, like the south side of Boylston Street (see Back Bay 2.0), the Seaport, and the Ink Block area.
- Second, under the best of circumstances, buyers are reluctant to take on a renovation project in the City. Now, with widespread horror stories of construction material supply bottlenecks, people are even more reluctant to take on a project.
- Finally, as much as we believe that co-op ownership is superior to condominiums, many people remain skittish about co-ops.
The trick to buying these kinds of units is to connect with a top notch general contractor and get a pre-purchase renovation proposal. Once you have a solid renovation budget and realistic time table in hand, you can move forward with a market correct offer to purchase that won’t leave you financially upside down.
Flying blind into a property that needs updating is a recipe for disaster. We have great relationships with some of the top general contractors in the area and we’d be happy to facilitate a well thought out acquisition and renovation strategy. Additionally, if you’d like to hear more about why we love co-ops, give us a call and we’ll walk you through our rationale.
Units 7R and 6F at 274 Beacon are listed with Campion & Company, unit 2 at 380 Beacon is listed with The Agency, and unit 2 at 270 Beacon is listed with Coldwell Banker. We’d be happy to set up a showing and walk you through our valuation analysis.
Well Bought/Well Sold
257 Commonwealth Ave, unit 3 – The Back Bay Clearing Price – Well Bought
After being on and off the market for the last four years, a hand full of price cuts, and two brokers, unit 3 at 257 Commonwealth Ave was bought by a developer last week. The final price for this 5,930 square foot 4 bedroom duplex came in at $7.5 million ($1,264/sf), 34% below the 2017 asking price of $11.75 million.
The building, which sits on a 50 foot wide lot, is one of the more desirable in the Back Bay. Designed by McKin, Mead & White, it’s historically significant and the property has been well maintained. This unit comes with two garage parking spaces and an expansive private rear patio. Two units in the building recently sold in less than a week (see “A Win-Win on Commonwealth Avenue“). So what’s the problem with this unit?
Beyond the obvious fact that it was outrageously mispriced, it’s just a weird apartment. We’re at a complete loss as to why there are two full kitchens. The grand reception hall, with a dramatic circular staircase, takes up a massive amount of the living space, and the flashy ornate finishes (gold ceilings, fluted columns, etc.) have limited appeal, with the possible exception of Donald Trump.
With respect to valuation, we’re not surprised that a contractor stepped in and bought the unit. With this much square footage, the possibilities are endless. There is a clearing price for everything and we’d say that $1,200/sf is the clearing price for a good quality Back Bay renovation candidate. We look forward to seeing the transformation, this unit was – Well Bought.
197 Commonwealth Avenue, unit 2 – A Rare Back Bay Bidding War – Well Sold
Unit 2 at 197 Commonwealth Avenue, a 1,175 square foot 2 bedroom has a new owner, or should we say a “victorious” new owner after a rare Back Bay bidding war. The “winning” bid came in at $1.745 million ($1,485.sf) off of an asking price of $1.625 million.
Bidding wars are few and far between in the Back Bay and Beacon Hill. While they do occasionally happen, in the past two years fewer than 5% of transactions above $2.0 million were higher than the asking price, and many of those were not actual bidding wars. Our market has been well balanced, which we see as a good thing for both buyers and sellers.
This unit is a bit generic and overdue for updating, but it is in a prime location. Without parking, we’d say that the buyer paid a premium. The rule with bidding wars is that the only winner is the seller – no exceptions. This was – Well Sold.
About Batterymarch Group LLC – Batterymarch Group is an independent full service real estate brokerage and advisory firm focused on the downtown Boston high-end residential market. We represent both sellers and buyers with a sharp focus on valuation. We also offer sub-advisory and owner’s representation services to financial institutions, family offices, and trustees.
About Andrew Haigney – A 25 year Wall Street veteran, Andrew held senior positions at leading global investment banking institutions where he routinely valued and negotiated complex securities transactions on behalf of institutional clients. Andrew has been an outspoken advocate of a universal fiduciary standard. In founding Batterymarch Group, Andrew brings that same discipline and passion to the real estate brokerage.