In this issue:
- The “Off Market” Market – Buyer Beware
- 73 Beacon Street – Gentrifying the Gentrification
- 100 Beacon Street, penthouse – Great Unit, Busy Intersection, Well Sold
- 220 Boylston Street, unit 1515 – $16.5 Million Trophy, Well Bought
What’s Catching Our Eye
The “Off Market” Market – Buyer Beware
The high-end “off market” has perked up in recent weeks. Not surprisingly, it yielded a record high price per square foot for a Boston condominium re-sale (see Well Bought/Well Sold, 220 Boylston).
Real estate sales agents’ strategy is to create a sense of urgency, so during a property showing they’ll inevitably make a veiled reference to another buyer who’s coming back for a second showing. In an off market situation this is intensified, with the narrative being that the property will soon be listed and widely advertised and therefore to expect a bidding war.
We’re not suggesting that buyers can’t get a fair deal in an off market transaction, but in our experience the seller generally gets the upper hand. Valuation analysis is even more important in an off market trade, especially with the market feeling a bit frothy.
73 Beacon Street – Gentrifying the Gentrification
Those who live on Beacon Street between Charles Street and David Mugar Way are no strangers to what seems like never ending construction projects. Neighborhood take note – 73 Beacon Street changed hands this week for $6.2 million in an off market transaction.
Clearly the plan here is to create more luxury condominium units, and this location definitely warrants that. Unfortunately the economics of these projects are driven by the ridiculously high prices that the developers pay. Buyers love these turnkey “new construction” properties, and as long as the market continues to reward these flippers, we see no end in sight.
Well Bought/Well Sold
100 Beacon Street, unit PHB – Well Sold
Unit PHB at 100 Beacon Street, a 4,083 square foot 3 bedroom, changed hands this week in an $9.326 million ($2,284/sf) off market deal. 100 Beacon is the site of the original Noble and Greenough School. The old school house was torn down in the 1920s to make way for the current building, which originally was a 40 unit apartment house. In the 1960s, Emerson College acquired the property and used it as a dormitory until it was sold to a developer in 2006 and converted into 19 luxury condominium units.
Pros: We’re huge fans of proper pre-war apartment houses. They offer a sense of spaciousness that’s very difficult to duplicate in typical Back Bay Victorian Era townhouses. This unit comes with two garage parking spaces and a private roof deck with amazing views.
Cons: The building sits on the Storrow Drive Arlington Street exit ramp which is a very busy, noisy, non-pedestrian friendly intersection. The parking garage is also a bit on the cramped side for our liking.
The last sale here was $9,000,000 back in 2012, so assuming that there was a brokerage commission involved, the seller got out even. We think that the seller did well getting their money back, we’re calling this one, Well Sold.
220 Boylston Street, unit 1515 – Well Bought
The “off-market” magic worked at the old Four Seasons with a record breaking $16,500,000 sale of unit 1515. At $4,102/sf this it believed to be the highest price per square foot every paid for a condominium re-sale in the City of Boston. Just to be clear, there have been a few higher price per square foot new construction sales, notably unit 6102 at the new Four Seasons which sold last year for $34,000,000 or $4,631/sf.
This 4,022 square foot 3 bedroom unit last traded in 2012 for $7,350,000. But what’s noteworthy is that it took nearly 2 ½ years to find a buyer last time around, and the pricing started at $8,950,000. Granted we were coming off the financial crisis back then.
Pros: The A+ location, walk out your front door and you’re in the Public Garden (if you walk out of the front door at the new Four Seasons, you’re behind the shopping mall, by the Cheesecake Factory). This unit is very dramatic with 18 foot tall windows looking out over Beacon Hill.
Cons: Obviously the valuation. Additionally, hotel service buildings aren’t for everyone. If you’re not living there full time, you end up paying for a lot of services that you don’t use. We do wonder if Boston can support two Four Season hotel properties, or like the “old Ritz,” could 220 Boylston sport a different hotel flag down the road? And would that impact values? Time will tell.
It should be pointed out that this unit last traded at the same time as unit PHB at 100 Beacon (highlighted above). It’s hard to reconcile the different results. This is clearly a trophy property and our guess is that it is probably considerably cheaper than a trophy wife, for that reason we’re calling this one – Well Bought.