Come the end of this week, a coterie of top brokers (like the game Mafia, no one will outwardly admit to having been tapped, but the usual suspects are presumed) will vie for the Petrossian of Candela caviar: the high-floor, five-bedroom duplex at 770 Park Avenue belonging to convicted felon Hassan Nemazee. Nemazee is serving a 12-year sentence at a federal prison in Texarkana, Texas, for bilking three major banks out of more than $292 million in false loans; apprehended in August 2009, he was put under house arrest in the apartment until his sentencing last summer. The U.S. Marshals charged with the sale of the home where Nemazee and his wife raised their three children (the youngest of whom this reporter attended school with) will weigh the presentations of five brokers before committing to one listing agent to move the co-op on the front-corner A-line.
Just as with the late Bruce Wasserstein’s apartment at 927 Fifth Avenue, brokers, like pigs, can sniff a truffle a mile away.
“The problem is there aren’t too many apartments like that that come on the market,” Douglas Elliman superbroker Dolly Lenz explained. “The people who are buying those apartments are in them for a long time. It’s not like you’re trading up; if anything, you’re trading down.” She was taking the call from the sidewalk in front of the holiday-wreathed facade of the Plaza, where she was meeting with a client. “It’s really the last apartment you buy. So at any given time, the supply is very low. I mean, I can’t even come up with another example. And, of course, the scarcity factor is what makes them sell.”
In a city with Jean Nouvel-designed glass houses and the Disneyland nostalgia of Robert A.M. Stern, one would think attention would shift from the co-op dowagers on the Upper East Side. Not at all, dear reader. Spacious prewar co-op apartments in one of the dozen “good buildings” on either Fifth or Park avenues still command unique premiums.
And while prospective buyers exasperate their brokers with a Goldilocks-like frustration–new condos have space and views but lack charm and history; prewar apartments are disarmingly quaint but too small or lacking in location and amenities; and on and on–some deep-pocketed ones know that a handful of larger prewars prove worth the wait.
“The Nemazee apartment is in that unique category, but it’s subtle. You’ve got to know the buildings to know how unique an opportunity this is,” Kathryn Steinberg, a top broker with Brown Harris Stevens, said. “I mean, you walk into that dining room and you go, ‘Wow.’ It takes your breath away.” (Wasserstein’s three-bedroom duplex was bought by real estate mogul William Lie Zeckendorf for $27 million last month after prospective buyers were given just 72 hours to hustle together offers.)
Brokers are desperate for the Nemazee listing. One under consideration refused to speak to The Observer for fear it could jeopardize the broker’s shot. Another broker called it a “gem” she was “dying to have.”
“It’s one of the best Park Avenue buildings, built by one of the best architects in the East 70s, which is the best location,” said Brown Harris Stevens’ John Burger, who brokered the last sale in the building, across the hall from the Nemazee’s apartment, and who currently has an eighth-floor listing for $11 million. “You know there are people who will or won’t go to the 60s, and people who won’t go to Carnegie Hill, but no one won’t go to the 70s.”
“The thing that pushes it up in value is the high floor,” Ms. Steinberg said. “There are other duplexes in that building, but not as high up.”
A broker familiar with the apartment said a 2009 government appraisal caused every agent to balk at the idea of a sub-$20 million estimate (the appraisal pegged the value in the high teens).
“If you took a logical approach and the value was a fact-based assessment, the asking price should probably be at $28 million,” the broker, who wished to remain anonymous, told The Observer by phone on Monday morning. “However, in an environment where different firms are giving different presentations for the client, it is in the broker’s best interests to give a higher value in order to flatter the client.”
The broker noted that the government has “a fiduciary duty to achieve the highest price for the property. If one firm gives a presentation suggesting the value at $25 million or $26 million, while another suggests a $29 million value, the government is going to have to have a very good reason before dismissing the $29 million option.”
Ms. Steinberg, who worked with Nemazee on the sale of his late mother’s estate and is familiar with the apartment, agreed with the $28 million estimated asking price. “I think that’s totally, totally fair. It could even go over $30 million, though it’s unlikely.”
But, with 770 Park being among the good buildings, and the apartment being on the larger side, it wouldn’t be surprising.
Last month, David Winter, scion of a family-run real estate concern, purchased a six-bedroom simplex at 778 Park Avenue for $26 million without the apartment even going on the market. “It becomes very subjective,” Ms. Steinberg said. “The apartment wasn’t unique, but it had six bedrooms and that’s very rare. There are only a handful of buildings that have six bedrooms, including 778 Park Avenue and 820 Fifth Avenue.”
“There’s an old-school popularity with those buildings,” Brown Harris Stevens’ townhouse topman Sami Hassoumi said with a sigh. “How would I call it–tradition, I suppose. There is a category of buyers who only go in the direction of old-line co-ops.”
Jonathan Miller, president and CEO of appraisal firm Miller Samuel and an expert on the New York housing market, low and high, summed it up with a dash of real estate realpolitik. “It’s about the exclusivity and prestige–all that is still alive and well.”
“You’re definitely onto something,” Ms. Lenz told The Observer from the curb outside the Plaza. “There’s no question about it.” The December wind rattled her cell, cutting her off mid-sentence. “Big, well-priced apartments sell quickly.”