The Batterymarch Insider

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“The Batterymarch Insider” is a brief snapshot of our current market thinking. As always, our “terms of use” apply. We encourage you to subscribe.

In this issue:

  • Batterymarch Mid-Year Awards – The $10 Million+ Condo Club
  • New and Noteworthy – Big Rollers Rolling Out of the Mandarin?
  • One Dalton – Big Tickets, Big Mortgages – Well Sold
  • 100 Revere Street – A Great House, Quirky Kitchen – Well Bought 

The Batterymarch Awards

$10 Million+ Condo Club Edition

As the market moves into its seasonal summer slow period, it’s time for our semiannual $10 Million+ Condo Club Awards (condominiums currently offered for $10 million+).

There are currently 11 club members.  Here they are:

1 Franklin St. unit GPH$45,000,000$3,394/sf
776 Boylston St. unit PH2E$24,999,000$3,661/sf
2 Commonwealth unit PH2$18,000,000$5,007/sf
1 Franklin St. unit PH4A$13,500,000$3,214/sf
776 Boylston St. unit W11A$12,375,000$3,906/sf
10 Rowes Wharf unit PH06$12,000,000$1,659/sf
2 Commonwealth unit 15E$12,000,000$3,281/sf
2 Avery St. unit 29EH$12,000,000$1,663/sf
305 Commonwealth unit 2$10,900,000$2,563/sf
400 Stuart St. unit PH3$10,250,000$2,891/sf
2 Avery St. unit 30EF$10,000,000$2,421/sf
1 Franklin

The White Elephant Award

Goes to unit GHP at 1 Franklin Street which is currently offered at $45 million. This 13,000+ square foot 8 bedroom unit previously traded back in 2016 for $35 million and has been on the market since late 2018 at this same price.

We don’t think we could in good conscience represent a buyer of this apartment at anything close to this price. Does anyone really need a $45 million 8 bedroom apartment in Downtown Crossing? We don’t care how good the view is, or if it’s an asset allocation play – if you’re looking to put $45 million into Boston real estate we think that there are better ways to do it. But that’s just our opinion.

2 Commonwealth

The Arm and a Leg Award

Goes to unit PH2 & 16E at 2 Commonwealth Ave. The reality is that this is probably our favorite apartment on the list as it’s a great location with amazing views. But at over $5,000/sf for a 2 bedroom apartment it’s difficult to justify. That said, if we were going to over pay for a Boston apartment, this would be on our short list, but $18.0 million? Good grief.

The Value Play Award

Rowes Wharf

Goes to unit PH06 at 10 Rowes Wharf. If you want the Seaport vibe, but don’t want to schlep over the Fort Point Channel bridge in the dead of January, look no further – this is the place for you. The unit, which has been on and off the market for over two years, is currently offered at $12.0 million ($1,660/sf), down from the original asking price of $16.0 million.

This 7,230 sf 4 bedroom penthouse triplex was originally the home of the Rowes Wharf developer. It has a private internal elevator with stops on all three floors and a dramatic two story entry foyer. Built in 1987, it retains that 1987 charm, so bring your contractor because the way we see it, it needs everything. It’s a great space in a great location, so at the right price, and with the right contractor, this apartment will be amazing.

305 Commonwealth Ave.

The Preservation Award

Goes to unit 2 at 305 Commonwealth Avenue. This building was completely renovated in 2015 by a well respected developer, the finishes are spot on. What’s special about this property is that it was never chopped up into small apartments like many Back Bay buildings. As a result, much of the 1886 intricate carved wood detail has been preserved and restored. It’s definitely not an aesthetic for everyone, but it is well done.

At 4,253 square feet, this 3 bedroom duplex occupies the first and second floors, has private outdoor space, and two car garage parking. These sellers bought the apartment in early 2019 for $9.5 million, which may have been too much at the time. Our guess is that they are trying to get their money back. We think $10.9 million is a bit ambitious, largely because it’s a lower level unit and pretty far down Commonwealth Ave. If you can make a reasonable deal on the price, this would be a great place to live.

New and Noteworthy

Mandarin (776 Boylston Street) – Big Rollers Rolling Out?

Mandarin Oriental

Is it us, or does it seem like this building is emptying out? There are currently six units offered at an average price of just shy of $3,000/sf. The average days on the market is 133, so they’re not exactly flying off the shelf.

Last week, unit W11A hit the market for $12.375 million. This west wing non-penthouse 3,168 square foot 2 bedroom unit last traded in 2012 for $5.575 million. It’s not clear what, if any, improvements the seller made to the apartment, but at $3,906/sf we’d at least want to be in a penthouse. Did we mention that condominium fees and taxes will run you $147,000/year?

Avery Street Comes to Life

1 Avery Street

We tend to think of units in the Avery Street towers in terms of years on market. But in the last month, 10 units have sold or gone under agreement. The average asking price of these units is just over $1,100/sf. Maybe buyers are starting to recognize the value.

These are true full hotel service buildings, so the monthly fees are relatively high. The towers were developed back in 2000, so we’d expect that some of the systems could be near the end of their life. We’d take a close look at the financials and meeting minutes to try and get a sense of any major assessments that may be lurking around the corner. We see value.

Well Bought/Well Sold

One Dalton, unit 5501 – Big Tickets, Big Mortgages – Well Sold

One Dalton Street

The developers at One Dalton have one less unit to worry about with the sale of unit 5501. This 55th floor 3 bedroom fetched $13.75 million ($3,716/sf). Buyers here still have the 12 month lock up language in their unit deeds because there are still unsold sponsor units. We are seeing more and more units offered for sale as the owners hit the 12 month anniversary.

While it has nothing to do directly with this unit, we couldn’t help but notice that a flooring contractor has filed a $1.9 million lawsuit against the One Dalton developer for alleged unpaid work. Apparently the contractor wants the whole world to know that they got stiffed so they recorded their Complaint at the Registry of Deeds.

Buyers of these big ticket properties aren’t shy about taking big ticket mortgages. No doubt their financial advisors are preaching the virtues of cheap money. We wonder how big ticket resales will hold up if we ever see a Federal Funds rate at 4%+? We’re not necessarily calling for higher rates, but it’s something to think about.

$3,716/sf, enough said, this was – Well Sold.

100 Revere Street – Great House, Quirky Kitchen – Well Bought

100 Revere Street

This 2,340 square foot 4 bedroom single family changed hands this week for the full asking price of $3.35 million. The house is in a great location with private outdoor space, just a few doors up from Charles Street. A unique feature of this house is the third floor family room that once served as an art studio with oversized front facing windows and a gas fireplace.

We’re big fans of smaller Beacon Hill single family homes as they represent very good value relative to comparable sized condominium units. The trick is to find a good one that has been updated and well maintained. As illustrated by the fact that this property had an accepted offer in 48 hours, this is a good one.

Like most Beacon Hill homes, this one isn’t without its quirks. This house has an odd kitchen layout which the listing described as a separate pantry/prep area. By our way of thinking, half of the kitchen was clear on the other end of the house. We had a client look at the house and the kitchen was a deal breaker for them. There is no doubt that the kitchen will be a liquidity headwind down the road. But it’s still a great house and we’re calling it – Well Bought.

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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 real estate brokerage.

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