“Private” Outdoor Space - Is it Overrated?
Batterymarch Group LLC is a full service independent real estate brokerage firm specializing in the downtown Boston market. More about our services here.
In this issue:
“Private” Outdoor Space – Is it Overrated?
Property Spotlight – 100 Beacon (Multiple Units), Great Building/Units, But Punitive Operating Costs? – 285 Clarendon, unit 2, If You Love Stairs, This Is the Place for You
2 Commonwealth Ave, unit PH/16E – $15 Million Trophy Property, Record $/sf – Well Bought
What’s Catching Our Eye
“Private” Outdoor Space - Is it Overrated?
An elevator, parking, and private outdoor space are the must haves for most high-end buyers in our market. This makes sense when you consider that empty nesters looking to downsize out of their larger suburban homes make up a large part of our buyer pool.
The first two wish list items are pretty straight forward, and the desire for outdoor space often relates to the unthinkable prospect of giving up outdoor grilling. But not all private outdoor space is created equal, and in some respects outdoor space can be overrated.
Don’t get us wrong, there are some properties that have amazing outdoor spaces that really define the property (see below, 2 Commonwealth - New $/SF Record), but this is the exception, not the rule. Actual privacy and ease of access are the two big variables when it comes to outdoor space.
Privacy – The idea that your outdoor space will actually be “private” is generally a bit of a misnomer. While you are the only one with access to your private outdoor space, you probably won’t be alone.
Abutting roof decks - Often the only thing between you and your neighbor’s roof deck is a low metal railing, giving the space more of a communal feel. Things like planters can mitigate the lack of privacy, but City building regulations limit what can be built to create a better sense of privacy.
Neighbors’ windows – It’s not uncommon for neighboring buildings to have party wall windows that open right onto your roof deck. Obviously, this creates all kinds of privacy issues. Additionally, taller surrounding buildings create a goldfish bowl effect, putting you on full display.
Access – Terraces that open directly off of living areas are clearly the most desirable set up. Not only are these spaces natural extensions of the living area, but they tend to be closer to kitchens which makes it much easier for grilling and entertaining.
When it comes to roof decks, having a proper staircase and a full walk out head house is the most desirable setup. Well designed head houses will have small refrigerators, a sink, and dry storage area.
Some of the worst rooftop setups involve ladders leading to a hatch. Under the best of conditions, these are dangerous to navigate, and we can’t imagine attempting to carry a platter of marinating chicken with us.
Utilization – The truth about urban outdoor space is that it’s very underutilized. On a 90 degree summer day, it’s going to feel like 110 degrees on the roof of the building. Then you have to contend with the annoying noise from the air conditioning rooftop condensers. Lack of privacy can also impact utilization.
High quality outdoor space is well worth a premium, and having any outdoor space is always a positive. But paying a premium for marginal outdoor space is ill advised. Realistically, it’s only practical to use outdoor space about 10% of the year in our area, so we advise clients to buy property based on how they will live in it the other 90% of the time. There are plenty of beautiful and quiet public places to relax outside in our amazing parks and green spaces.
From time to time we highlight properties that are actively offered for sale. Batterymarch Group is focused on buyer representation, so the highlighted listings are not ours. We’re happy to set up showings of these properties, offer our valuation analysis, and assist with preliminary renovation budgets.
100 Beacon Street (Multiple Units) – Great Building/Units, But Punitive Operating Costs?
Four 3 bedroom units have been on and off the market for some time over at 100 Beacon Street. The units are all just under 2,000 sf with an average asking price of just over $3.0 million ($1,546/sf).
Built as a 40 unit apartment house in the mid 1920s and subsequently used as an Emerson College dormitory, the property was converted into 16 condominium units with onsite parking for 15 cars back in 2006.
Pros: Prime Back Bay location - easy access to the Esplanade, Public Garden, Charles Street, etc. Windows – the Beacon Street facing units get great sunlight while the rear units have great river/Cambridge views.
Cons: Condominium fees – the fees seem punitive to us. Storage – the closet space is adequate, but there is not additional storage space in the building.
High monthly fees can haircut the value of condominium units. This is well illustrated by the average selling price per square foot for the three Ritz buildings on Avery Street, which over the last nine months stood at $970/sf. It should be noted that unlike 100 Beacon, the Avery Street properties are true full service buildings so we see some justification to those fees, and the high fee structure is discounted into the prices.
We want to love this building (and the units) for a bunch of reasons, but we see a serious problem with the operating cost structure. We’re giving these units a thumbs down based on the high monthly fees.
285 Clarendon, unit 2 – If You Love Stairs, This Is the Place for You. Offered at $3,995,000
Unit 2 at 285 Clarendon Street, a 3,063 square foot 2 bedroom lower level triplex with one outdoor parking space, is part of a five unit 1988 condominium conversion located on the corner of Beacon and Clarendon.
Pros: Great Back Bay location. Windows – 19 windows with three exposures. Building improvements - in the process of getting a new roof and repointed (we would have waited for the scaffolding to come down prior to marketing the unit, maybe the seller is motivated).
Cons: Lower level in basement (approximately 857 sf) with three sump pumps and three dehumidifiers; there’s clearly a moisture problem. Stairs - the stairs felt awkwardly tight. Awful layout - the 11’ x 10' kitchen is up an additional half a flight of stairs on the upper level.
If you love climbing stairs, this is the place for you. It’s an older condominium conversion and, by our way of thinking, the layout is antiquated and needs to be reworked (not cheap). Our other gripe relates to the moisture issue in the basement - we’ve never encountered a unit with three sump pumps and three substantial dehumidifiers. While it’s subjective, it still smelled musty to us.
The unit was unsuccessfully offered for sale in 2017 for $3.895 million and re-listed last August for $4.295 million, and is currently offered at $3.995 million ($1,304/sf). $1,304/sf may seem reasonable for a nice Back Bay unit with parking, but assigning that value to the 857 sf of lower level space seems like a mistake to us.
The property is listed with Gibson Sotheby’s, and, as usual, we’d be happy to set up a showing and walk you through our valuation analysis, together with our ideas for updating the unit.
Well Bought/Well Sold
2 Commonwealth, unit PH2/16E – New Price/SF Record - $4,172/sf – Well Bought
Unit PH2/16E at 2 Commonwealth Ave, a 17th floor 3,595 square foot 2 bedroom penthouse duplex has a proud new owner for a cool $15.0 Million. The seller didn’t get their $5,000+/sf, but at $4,172/sf we have a new city wide price per square foot high water mark.
There are five penthouse units at 2 Commonwealth. What makes this one unique is that it was combined with the unit below to give it 3,595 square feet of living space. As originally built, the other penthouses are about 2,500+/- square feet, not exactly what we would call spacious. When you factor in the terrace, views, and the premium location, the sale price and relatively quick deal (115 days on market) isn’t a surprise.
The 1,600 square foot terrace with its mature landscaping is the real show stopper. These types of terraces are very common in Manhattan where zoning regulations require “wedding cake” architecture to reduce buildings’ shadows. We normally cringe when a listing broker uses words like “rare” when describing a property, but terraces like this are indeed rare in Boston.
Analyzing the valuation of these trophy property sales is somewhat pointless – let’s just say it’s a bit of a financial “flex.” That said, compared to the other trophy sales this year, this one actually makes the most sense to us, and we’re calling it – Well Bought.
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.