825 N. Kings Rd. #4 (90069)
2BR/1.75BA, 1322 sq ft ($526/ft)
$100K Price Reduction. 2008 AIA Nat'l Housing Award recipient, Habitat 825 by Lorcan O'Herlihy Architects. Interlocking lime-green & Redwood volumes blend light, materials & color to create the sculptural facade & expansive courtyard. The urban semi-communal space is enhanced by Bamboo-themed landscaping. Green-design elements. Within open areas of living/dining, kitchen w/Boffi cabinetry Miele, Subzero, Toto, 2 beds/2baths, & prvt rear patio. Adjacent to The Schindler House. SXS parking
Last Sale - 8/07 - $797,000
Listed - 10/08 - $879,000
Reduced - 11/08 - $795,000
Reduced - 3/09 - $695,000
I have not seen these units, and aside from our prior discussion of the benefits/drawbacks of Kings Rd in general, can't speak for their appeal. Maybe someone who's seen them can chime in.
It does look like we have two potential situations going on here: a developer who's broken even, and shadow inventory.
From public records, it looks like the developer is into the property (including purchase of prior property and construction loan) for approx $11mm.
PropertyShark shows 11 of the 19 units as having sold. All but one show sale dates in August 2007 - not a stretch to assume that's when the building opened. Another was sold in December 2007. Total sales price = approx $12.5mm. So throw in some additional costs, for broker representation, etc, and it looks like the developer's essentially broken even.
But what about the other 8 units? No sales records anywhere. It's certainly possible that the developer(s) took a few as their own, in fact, it looks like that happened with at least one of the other units. With the developer at break-even, wonder if we see the unsold units come on the market?
As we can see, this seller has lost all or almost all of his/her equity, and the reduction process has been slooow. This also sets a comp (at least on a relative basis) for the other units in the building - maybe a sign of more distress to come?
And in case this hasn't been made clear previously, the point of these postings is not to point the fingers at the buyers (now sellers) of these properties and say "nah-nah, told you so". It's easy to get caught up in any bubble mentality - the fear and greed cycle is strong. The point is, you can (and people are) lose significant money in real estate, and this idea of past nominal prices was just a fairy tale. It's amazing that agents are still marketing properties with tag lines like "appraised for over $x 2 years ago" or "$100k reduction!". As we've seen before, there's a long way yet to go in this downturn, and by the time we look back and see the bottom, we'll have realized that affordability ultimately drives the real estate market.
5 comments:
I looked for, but couldn't find, the piece the LA Times did on this building shortly after it opened. It's actually pretty spectacular, with lots of semi-famous residents and so forth. I'm struck by the fact that they now can't get even $600 a square foot for big two bedrooms in this modern landmark, and yet those Hancock Lofts people are still dreaming about $900/sf.
Agree that the Hancock Lofts are overpriced, even if they are extremely centrally located for young gay singles and/or couples. I would think the location might be too close to the gay strip for straight singles or couples (e.g., too trafficky and loud with none of the benefits).
I remember that LA Times piece too, with a photo of a lady luxuriating and rhapsodizing about the structure's neighborly ambiance. Perhaps the 8 unaccounted for units are now rented. If so, I wonder what that would mean to a lender approached about Unit #4. Don't lenders nowadays like to see condos that are about 75% owner-occupied--or is that an outmoded thought?
There seems to be so much shadow inventory in the area. But we'll keep that close-to-the vest, close-to-the chest-- that's how things are done in WEHO and adjacent BH.
Following up, according to Los Angeles County Assessor records, all 19 units at 825 N. Kings have sales data, 18 in Aug. - Dec. 2007, with Unit #2 the last sold for $1,145,000 on 1/15/08.
In this case, there does not appear to be shadow inventory, but, still, are these owner-occupied or does it make no difference to potential lenders?
It's interesting that Property Shark lumps unit sales under one listing for an address while LACA provides individual unit listings, each with its own parcel number and data.
I looked at this place--it's pretty awesome, great space inside, a kitchen to die for. Only problem is the complete lack of sunlight. But the place is great. And King's Road's a pretty decent street.
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