"Deep Space" – The Rockefeller 27 Foot Rule
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In this issue:
“Deep Space” – The Rockefeller 27 Foot Rule
New and Noteworthy – Back Bay & Beacon Hill High-End Market is on Fire
205 Commonwealth Ave, unit 6 – A Back Bay Wallet Fight? – Well Sold
100 Belvedere, units 11A & C – The Belvedere vs One Dalton – Well Sold
What’s Catching Our Eye
"Deep Space" – The Rockefeller 27 Foot Rule
No office space can be more than 27 feet from a window. These were the marching orders that the architects were given when designing Rockefeller Center. Why 27 feet? Because it was determined that, given New York City’s latitude, 27 feet is the maximum distance that sunlight can permeate windows of an office building. The term “deep space” is used by architects to describe interior space beyond the reach of natural sunlight.
In the Back Bay and Beacon Hill, when developers convert properties that were originally intended for single family use, they need to make use of every available square inch in order to maximize profits. The result is that living space gets extended into the deep space.
While the Rockefellers deemed deep space to be unfit, even for the lowliest Bob Cratchits of the world, deep space is a reality in our market. The good news is that with open floor plans and good lighting, it often works. But we do come across some high-end properties where deep space is problematic by our way of thinking.
Take 52 Beacon Street, unit 1 (asking price $4.95 million, $1,212/sf), the kitchen and family room are tucked in the rear of this unit. The lack of rear windows on this level magnifies the deep space feeling. 52 Beacon is a great location, and $1,212/sf for newly renovated space on Beacon Hill seems like good value, but nearly $5 million to live in a cave? No thanks.
Over at 63 Mount Vernon, a seven unit re-development with fancy price tags, we were surprised that some units seem to be in violation of the Rockefeller rule. Most of the kitchens are separate from the living area and are a good distance from a natural light source. We were underwhelmed with the finishes at 63 Mount Vernon, so we'll be watching with interest to see how these units sell.
Light and air – that’s the name of the game in high-end real estate. If it’s not good enough for Bob Cratchit, why pay top dollar to live in it?
New and Noteworthy
Beacon Hill & Back Bay - High-End Real Estate Market is Red Hot
Last week, we highlighted the $25.0 million condominium unit at the Mandarin Oriental that is under contract. The big ticket deals keep rolling along. Going under agreement this week we have:
14 Walnut Street, an 8,300 square foot, 6 bedroom single family on Beacon Hill. The last asking price on this one was $12.69 million. The pricing started at $15.0 million and 672 days later they finally have a deal.
400 Stuart Street (The Clarendon) PH3, a 3,545 square foot, 3 bedroom on the 33rd floor with a last asking price of $10.25 million ($2,891/sf). This unit was on the market back in 2015 for $10.95 million and didn’t find a buyer. Six years later getting a deal at a lower price may not feel great to the seller, but hopefully the seller is giving thanks to the liquidity gods.
We’ll report back when we get the final sale prices on these.
The Sudbury (110 Sudbury Street) – 4 Down, 51 To Go?
The marketing at the Sudbury in the Bullfinch Crossing development has been in full swing for some time. As far as we can tell, only 4 of the 55 luxury condominium units have sold. We’re not surprised at the slow pace of sales, and we’ve previously commented on the challenges of new developments in what we see as “no man’s land.” See our commentary here.
Last month, the Bullfinch Crossing developer requested City approval to amend the second phase of the development which was originally to include additional upscale residential, hotel, and retail space. The new plan is to build office and a research laboratory facility. We view this as a negative as the high-end retail and hotel was a big component of the “lifestyle” they are marketing.
Separately, having lived through the bio-tech bubble of the early 1990s, if there was a way to sell short all the announced “lab space” we’re constantly hearing about, we’d take that trade all day long.
Well Bought/Well Sold
205 Commonwealth Ave, unit 6 – A Back Bay Wallet Fight – Well Sold
Unit 6 at 205 Commonwealth changed hands last week with a final sale price of $2.65 million ($1,638/sf). This 1,617 square foot, 3 bedroom, with parking, is a classic Back Bay floor through apartment. This 10 unit condominium complex resulted from the combination of 205 and 203 Commonwealth in 1979.
This unit last traded back in 2005 for $1.49 million. It’s been on the rental market since 2015 which has probably been a good thing for the seller, but not so great for the new owners. Rental properties tend to be ridden hard and put away wet.
This unit was unsuccessfully offered for sale back in 2018 for $2.85 million. After a few more years as a rental, it reappeared on the market a year ago at the same price, $2.85 million. After six months the price was dropped to $2.495 million, and still no takers. It was re-listed this spring at $2.595 and in six days (and what looks like a bit of a wallet fight) they got this deal done at $2.65 million.
From a valuation perspective, we like the fact that the roof was recently replaced, but being an older condominium conversion we’d expect other systems may be at the end of their useful lives. The unit itself is nice (although dated), but squeezing three bedrooms into 1,600 square feet doesn’t lend itself to a feeling of spaciousness. We’d say that the seller got the better end of this one, it was – Well Sold.
100 Belvedere Street, units 11A & C – The Belvedere vs One Dalton – Well Sold
A pair of units sold at 100 Belvedere (The Belvedere) last week to the same buyer for a combined total of $8.0 million. Unit 11A a 2,306 square foot, 2 bedroom ($2,298/sf), and unit 11C a 1,712 square foot, 2 bedroom ($1,577/sf).
The Belvedere, a 61 unit building built 20 years ago, isn’t our cup of tea. We suppose that if you worked in the Prudential Tower, which is connected via the shopping mall, it would be nice to head off to work without an overcoat in the dead of the winter. This package deal also included four garage parking spaces, which is pretty attractive.
One of our gripes with this location is the distance from green space. Yes, you are across the street from the Christian Science Reflecting Pool, and you could run through the fountain to cool off during a heat wave, but it’s a serious walk to the Esplanade or the Public Garden.
It’s also nice to have a doorman and 24 hour concierge, and being above the Cheese Cake Factory, I’m sure that they would be happy to send up a platter of chicken wings from time to time. But if we wanted to be in a true full service building in that area, at that price point, we’d opt for the Four Seasons (One Dalton) just across the street.
There have been five re-sales at One Dalton in the last 12 months with an average selling price of $2,220/sf. The average price per square foot for this two unit package was $1,991. We’d think the premium to live at One Dalton with superior amenities is warranted. If renovations are in the cards at the Belvedere, you’d be way ahead of the game at One Dalton. And really, who wants to live at the Mall? These units were – 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.