What $1.5 Million Buys Now

What $1,500,000 Buys Now
BY CARL SWANSON
Published: April 10, 2000, New York Magazine

“What can you get for $1.5 million?” says independent broker Patricia Burnham, calling from her car on the way back from the Asian Art Fair at the Park Avenue Armory. “Not even a one-bedroom on Fifth Avenue. I recently sold a penthouse on Fifth — a one-bedroom — for almost $2 million. It wasn’t even that big. It’s probably the size of your apartment.”

People who don’t require penthouses should at least be able to get a two-bedroom for that much these days, maybe even with a maid’s room — what’s known as a “classic six” in industry parlance. You can still find them on Sutton Place, with balconies. But times are tough on the Upper East Side. “One-point-six million dollars would have bought you a 1,600- square-foot two-bedroom at the Empire,” a new condo building on East 78th Street, says Alexa Lambert of Stribling & Associates. “But they’re gone. And that’s on Third Avenue, where everybody said they’d never live — a block away from the subway and near Lenox Hill Hospital.”

“You used to be able to get a modest classic six on Park Avenue for that much,” says Corcoran senior vice-president Scott Durkin. “Not anymore. You get maybe 1,500 square feet. It would get you a five-room condo on the West Side. But the real bang for your buck these days is in lofts. You’re getting more space, and they’re laid out more like an apartment; the days of the single big room with one bathroom and a futon are over. And most of the new loft buildings have doormen.”

Over on West 27th Street, two-bedroom, 3,000-square-foot lofts have staked out this range. In TriBeCa, you can get a brand-new 2,600-square-foot loft in Cobblestone Lofts ($1.6 million, even if it does overlook the Holland Tunnel entrance plaza). At 158 Reade Street, you can buy an 1,800-square-foot townhouse that once illustrated a piece in New York Magazine about urban pioneers. “An architect bought it and renovated it. Then it was $120,000 in what was known as the butter-and-egg district,” says the broker, Stribling/Wells & Gay’s Bruce Ehrmann. Now it’s $1.45 million: “The story of that house is the story of this neighborhood.”

But if you want to live in certain rarefied-lifestyle zones in the city, your eye is going to have to adjust to the charms of the $1.5 million one-bedroom apartment. “You can still get an incredibly stylish one-bedroom at 32 East 64th Street,” says Kirk Henckels of Stribling & Associates. (That’s the building Mike Wallace used to live in.) “Two fireplaces. Feel like you live in Paris.”

What if West End Avenue is more your arrondissement? “Ai-yi-yi,” says Emma O’Brien, who works the Upper West Side for the Halstead Property Company. “A six-room in excellent condition on West End Avenue in the Eighties. That’s not quite a million-five, but it’s pretty close. Or a seven that needs work.”

But not on Central Park West, where, according to Brown Harris Stevens’s Elizabeth Sample, a classic six “on the side” of the building, meaning not overlooking the park, is going for well over $2 million. For views, hie hither to a postwar high-rise, says O’Brien, and you’ll get change back for your million and a half: “You can get a two-bedroom condo with open city views at Two Columbus Avenue or one of the Millennium buildings.”

But a townhouse on the Upper West Side at that price is pretty difficult, unless you think you’ll outlive the passel of rent- stabilized tenants occupying the building’s apartments. If you want to live by yourself, “Murray Hill’s your best value, just because there’s some inventory,” says Jon Capobianco of Alice Mason Ltd. “But it’ll be a small house, probably 3,500 square feet. And there’s nothing on the Upper East Side. Even the smaller houses on East End Avenue are all selling for $2 million. It’s tough all over to find a townhouse for 1.5.”

The values are even worse downtown, says Capobianco. “It’s very hard to find them, and they’re very small houses, mostly unrenovated,” he says, citing one such house currently for sale on Gay Street for $1.6 million.

Queens is a better bet. The broker for a five-bedroom house on the market in Forest Hills Gardens brags about its enormous, state-of-the-art kitchen. And Brooklyn’s not shabby, either, although things are getting a bit tight. “In the central Slope in a prime location, you should be able to get something for $1.5 million,” says Anna Hamlin of the Park Slope office of William B. May Company, “and you probably can. But the pathway to it will be tortuous.

“It used to be that $1.2 million was the prize amount,” she continues. “And that was up until recently. You can’t do well at 1.2 anymore. You have to go to one and a half. And you might get a home in great shape. Or not. It depends on the seller. You might have to put $500,000 into it.”

Co-ops in Park Slope aren’t yet up to that level, she says, although there are some in Brooklyn Heights that are (there’s one on the market at $1.45 million at 2 Montague Terrace, with three bedrooms and “lovely partial city and water views”).

You can barely spend that much in Harlem, says broker Willie Kathryn Suggs: “That’ll get you 54 Hamilton Terrace. When Bishop Tutu’s in town, he stays there.” It’s seventeen feet across with working fireplaces and twelve-foot ceilings, “the most expensive home uptown,” she says. That’s $1.2 million. Just try not to think about how “they paid $280,000 for it in 1992 and didn’t do shit to it but sand the floor.”

Upper West Side
Four-story, 3,500-square-foot townhouse on West 88th Street, off Amsterdam Avenue.
Paid: $1.33 million.

Architect Paul Gleicher of the Gleicher Design Group and his wife, Lisa, a television producer, were living in a classic six on 72nd Street and Riverside Drive. They’d bought it for $388,000 after its former resident died of old age in 1992. “It was sealed off with police tape,” remembers Lisa, “and full of cockroaches lying in the surrender position.” They gut-renovated the place and lived there until they had another baby. It was then that they started feeling guilty about her growing up in a six-foot-wide maid’s room.

“We started looking and looking and looking,” says Lisa. “And quietly put our place on the market.” It had pink ceilings, yellow walls, and green hallways, but nevertheless the couple ended up presiding over a bidding war, all offers at or above the asking price. “People were hyperventilating, they wanted our apartment so much,” she says. It went for just under $1.5 million.

“While all that was going on, we found a brownstone on West 71st Street that was asking $1.8 million,” Lisa continues. “It had no architectural character at all. We were going to turn the top floor into a rental.” The only problem was that one tenant wouldn’t leave. The seller assured them that he was on his way out. Lisa called and found out that he was indeed fourteenth on the waiting list for senior low-cost housing, but that he’d be there for years. “I could not, in my heart, kick him out. But he was so scary — and his apartment so disgusting — I didn’t want to live with him.”

Then “we opened up the paper one day and there it was,” the brownstone they ended up buying, from Vandenberg’s Dexter Guerrieri. “It was thirteen feet wide, and nobody wanted to see it.” But since “there was really nothing under $2 million on the Upper West Side,” they had a look.

“It’s in horrible shape,” she says, “beautiful, but there are holes in the ceiling. It’s completely dilapidated, unlivable. And divided up into apartments, which because of the hallway brings some of the room widths down to nine feet.”

On the other hand, her husband was intrigued as an architect. The building is 66 feet deep. All the kids will have their own bedrooms on the third floor. The parlor floor has eleven-and-a-half-foot-tall ceilings, a bay window, and an onyx fireplace mantel. The oak wainscoting is still intact on the winding staircase.

The big problem is going to be the cost of the renovation. The building needs a new boiler, electrical system, plumbing. “It’ll take six months,” she says.

In the meantime, the family might move out to Long Island to live with their in-laws. “Worst-case scenario,” says Lisa, “we do it and then we go broke and sell it.”

Upper East Side
Four-bedroom prewar co-op in the Seventies, between Park and Madison Avenues.
Paid: $2.1 million; maintenance, $2,900.

“We had friends in apartments like the one we wanted,” says the buyer of this elegant co-op on a side street in a non-power building. After her daughter was born, she and her husband started looking — intending to pay “under a million,” she says. They’re both successful attorneys, with commensurate expectations: They wanted to move from their newlywed two-bedroom in a boxy sixties building to a seven- or eight-room prewar apartment.

“We were looking for a place to settle down for life,” she says, then sighs. “I didn’t know how tight the market was. As we looked, it just got tighter and tighter. We bid on seven apartments. Seven!” This was frustrating. Isn’t life supposed to be easier when you’re making good money? “I know partners at law firms who can barely get apartments to accommodate their families,” she says.

But they figured they’d never see their kids if they moved to the suburbs. So they stuck it out, bidding on apartments they didn’t really want, marveling over the weirdness of the market.

“One of the apartments was burned — the whole apartment had been gutted by fire,” she says. “You could smell it. You could see it on the walls. It was awful; paint was falling on us. You could see the bed mark. It was like a ghost on the walls.” They didn’t bid, but in the end, “it went for $1.2 million and it was only a two-bedroom.”

Finally, one morning, their broker, Gene Fein of Stribling & Associates, called them from the kitchen of a brand-new listing and said, “Come now!” “We dropped everything. We made a bid that was trumped by one or more people. And it went to sealed bids. In that process, we came in second.” But they weren’t going to let that stop them. “We spent the entire week trying to identify the sellers so we could find someone who knows them to vouch for us. Their broker wouldn’t tell us, appropriately.” Finally, they figured it out. “We wrote the sellers a letter saying who we were, and found a person who knew them and had them call.”

That worked. The buyer sounds happy but a bit shell-shocked by the experience. “Our parents would be horrified, knowing what we paid,” she says. “We’re at the top of our profession and are working-class zhlubs, apparently.”

Flatiron District
2,200-square-foot co-op loft on Fifth Avenue in the Teens.
Paid: $1.1 million; maintenance, $2,258.

When Jamie LeFrak, the 26-year-old grandson of Forbes 400 fixture Sam LeFrak, returned from working in Los Angeles, he actually considered living in one of Grandpa’s trademark middle-class apartment projects. “We have a big one down in Battery Park City I thought about moving into,” says the young developer. “I think I just wanted to buy an apartment after having spent no more than two or three years in any given place for the last ten years.” LeFrak City, in Queens, was presumably too inconvenient.

Back when he was growing up on the Upper East Side (“Where else, right?”), he thought the Flatiron district was the place he wanted to live. “That was in the early nineties. The prices at the time were really inexpensive.” But after Princeton, a master’s in civil engineering at MIT, and a stint as project manager on the Hollywood & Highland entertainment-and-retail development (which includes the Premiere Theater, future home of the Oscars), he discovered that the neighborhood, like so many others in New York, was undergoing “some kind of luxury shift.”

He browsed lofts and more conventional prewar apartments in the Flatiron district for about a month with Sotheby’s broker Stephen McRae. “I didn’t look that long, but I’m a real-estate guy,” he says. “I know what to look for.”

Lofts seemed the better value. “I still can’t understand why someone would pay more for lower ceilings,” he says of some prewar apartments he looked at on lower Fifth Avenue.

Funnily enough, he ended up going back and buying the first place he saw — a 1981 conversion of an 1898 building that used to be “some kind of textile factory and then was a place where tailors would sell their custom wares. One of my construction supervisors said, ‘This is where I used to buy my suits in 1952.’ ” The previous owner “was obviously an investment banker who worked all the time. There was a couch. And a bed.” And a 600-square-foot landscaped terrace. “Coming from California, being cooped up in a box seemed a little bit depressing,” he says.

Meanwhile, McRae keeps getting offers to sell the place for substantially more than Lefrak paid for it. But he isn’t budging: “You flip the apartment, and then where do you live?”