Flying the Co-op: $20 Million Houses Lure City Mommies

PRIVACY SEEKING PARENTS FOLLOW GWYNETH, SARAH JESSICA On Aug. 16, in a nail salon across from Peter Coppola’s on Madison

PRIVACY SEEKING PARENTS FOLLOW GWYNETH, SARAH JESSICA On Aug. 16, in a nail salon across from Peter Coppola’s on Madison Avenue, a svelte blond Upper East Side mommy was working through her French manicure. There was a call to a fellow Horace Mann parent, then a lengthy message to her father’s voice mail, then a blow-by-blow to a confidante about her search for a new $12 million home. This is how she saw her options in the almost-$1,000-a-square-foot market she had been chauffeured around: You can’t imagine how “crazy” she is about high ceilings; the main reasons to live in an apartment are the views and light from, say, the penthouse; but if she couldn’t find an apartment with all these things, she’d rather sacrifice her fully staffed co-op for a townhouse that needs $1 million worth of work.

On this matter, the young mommies seem to have a consensus. “Families are the ones fueling the townhouse market,” said Richard Steinberg of Ashforth Warburg. “The couples I specialize in are young Wall Street and technology couples.” In the past year, Mr. Steinberg has sold 10 East 75th Street to a couple in their late 30’s with two children, who moved out of their Park Avenue apartment in search of more space. They paid $6 million for the house, which they will totally renovate. A stockbroker in his mid-40’s with three kids paid $5.7 million for 8 East 77th Street, which also needed a gut renovation.

In this economy, the townhouse has become the trophy home of choice, over–or sometimes in addition to–a bucolic estate in Westchester. A townhouse offers an average 4,000 square feet of space; it can be re-configured without the inescapable house rules of a co-op; most of the time it has a garden out back; and it guarantees a certain amount of privacy that in this town only money can buy. According to statistics gathered by the city’s top two real estate firms, the Upper East Side townhouse is the most expensive type of property per square foot in the city; the Upper West Side townhouse comes in second, a downtown loft or townhouse, third–yet the Upper East Side co-op still holds the record as the city’s highest-priced property.

The idea of a private home in the city lured the buyers of a narrow, 18.9-foot-wide house at 126 East 73rd Street from Connecticut, said Laurance Kaiser, president of Key-Ventures Realty, who brokered the $11.5 million sale, which will close on Sept. 7. The house was on the market for three months and six people made bids.

The high price of a townhouse has always been chalked up to “the fact that there’s a finite supply of townhouses,” according to Jed Garfield, managing partner at Leslie J. Garfield, which only sells townhouses. The limited number “increases their appeal significantly,” he said.

Take 8 East 62nd Street, a landmarked Beaux Arts five-story mansion between Fifth and Madison avenues, which went on the market for $23 million in January (the seller, architect Emilio Ambasz, bought it for $3.2 million in 1992). Or take the home exactly one block north, at 8 East 63rd Street, which Dr. Murray Banks, an 84-year-old psychiatrist and author, put on the market for $18 million on Aug. 9–and it’s going to come with a tenant. Or the five-story limestone mansion at 354 West End Avenue between 76th and 77th streets–one of the few single-family homes on West End Avenue–which has been on the market for six weeks for $3.3 million. “If you’re spending extraordinary amounts of money, you may as well own a real piece of property,” said Michele Kleier of Gumley Haft Kleier Inc., who’s selling the West End Avenue house. “People think townhouses hold their value more.”

“I’m flabbergasted,” said one broker about Mr. Banks’ price. “I’ve completely redone it,” said Mr. Banks of the 12,500-square-foot house he bought in 1952 and which is not cut into two duplex apartments. Another broker wasn’t surprised at all: “I’m showing more [houses] priced over $10 million than I ever did before,” said George van der Ploeg, a broker with Alice F. Mason.

Part of what $10 million buys is personal and financial privacy. Buying a townhouse instead of a co-op protects a potential buyer from co-op board scrutiny–and the chance of rejection–not to mention having to share an elevator or a roof terrace with strangers. Mr. Kaiser said that his Connecticut buyers “didn’t want to fight with boards.” And you can buy a townhouse in a corporation name. “Fine families love that,” he said.

Mr. van der Ploeg argues that the townhouse is suitable only for patient buyers. “A lot of them need a substantial amount of work,” he said. “It does seem that many buyers are not willing to take on a two-to-three-year project, which is why some of these houses have not sold.” The owner of 20 East 73rd Street sunk $7 million into his house, including a brand-new basketball court in the basement.

But a renovation project can be a profitable business. Take Michael Cannon, a wealthy Englishman in his 50’s who moved to Manhattan two years ago. He hooked up with broker Richard Steinberg of Ashforth Warburg–after only one week of townhouse shopping, Mr. Cannon bought a house at 63 East 66th Street for $3.75 million and another one at 13 East 75th Street for $4.85 million.

Mr. Cannon never moved into either house. After sinking $1.4 million in renovations into 13 East 75th Street and $1.5 million into 63 East 66th Street, he relocated to Boston, selling the house at 66th Street for $7.25 million and the house at 75th Street for $7.4 million–and discovering a new and profitable hobby. In May, he bought a house at 10 East 73rd Street from the New York Board of Rabbis for $4.8 million and has already started renovating.

Buyers may not miss having neighbors, but having somebody there has always seemed safer. Uma Thurman and Ethan Hawke and Sarah Jessica Parker and Matthew Broderick live in West Village townhouses rather than having to deal with lobby ogling. And the stalker-conscious Gwyneth Paltrow chose to install a video camera outside her townhouse on Perry Street rather than have anyone know her comings and goings. “Electronic alarm systems have gotten much more sophisticated,” said Corcoran townhouse broker Anne Snee.

Or there’s the advice of Patricia S. Burnham, who’s trying to sell 603 Park Avenue, a townhouse at the corner of 64th Street that has been on and off the market since 1989, when developer Sherman Cohen bought it from Happy Rockefeller’s mother: “You could put in a doorman!”


FRESH FROM SUING 100 U.N. PLAZA, STEPHEN GREEN SIGNS ON AT TRUMP WORLD TOWER Donald Trump sounded positively tickled. He was speaking about the fact that Stephen Green, real estate developer and brother of Public Advocate Mark Green, would be among the first residents of Trump World Tower, his high-rise under construction at 845 U.N. Plaza. “It’s the greatest honor when a real estate professional buys in your building,” said Mr. Trump. It’s not such an honor when a real estate professional sues your building, however, like Mr. Green did in 1992.

Mr. Green, 62, and his wife, Nancy Peck, sued the condo board of 100 United Nations Plaza, where they have rented a duplex apartment since 1988 for about $15,000 a month, claiming that the building was responsible for water damage to their apartment. In court documents, the couple complained of “discomfort, annoyance, fatigue, anxiety, insomnia and emotional distress” as a result of the damage. They say they also suffered buckling wood floors. They asked for about $200,000 in damages but settled for $125,000 in March of 1999.

The way Mr. Trump describes his new 90-story building, which he says was topped off a couple of weeks ago, the stakes there would be much higher. Mr. Green has signed up for two adjacent apartments–over 4,000 square feet total–on a high floor where Mr. Trump claims that space is going for more than $2,000 per square foot. Since the building isn’t expected to be finished until next April, the couple has been able to do their own blueprints, creating a large master suite. “They’re doing a fabulous apartment out of it, redoing it all,” said an agent at the building’s sales office. Practically the only thing that is not negotiable are the 12-foot ceilings. Potential defendants, er, condo board members so far are Microsoft chairman Bill Gates and producer Marty Richards, and an as-yet-unidentified buyer of four apartments for a total of $38 million.

Mr. Trump remained optimistic, saying that having Mr. Green in the new building will be “even greater than all the celebrities, which I have anyway.”


$13 MILLION REASONS TO STICK AROUND IN AUGUST Not every co-op board plays hard-to-get during the summer. On Aug. 2, the board of 1125 Fifth Avenue–home of fall TV hopeful Bette Midler, actors Kevin Kline and Phoebe Cates and international businessman William Louis-Dreyfus (his daughter Julia was Elaine on Seinfeld )–gave their approval to the buyers of the 10th-floor apartment. The price was $13 million.

The apartment belonged to Leonard Toboroff, vice president of Riddell Sports Inc., a sporting goods manufacturer, and vice chairman of Allis-Chalmers Corp., a mechanical repair and service company, and his wife, Joy. The 5,500-square-foot, 12-room apartment has four bedrooms, four and a half bathrooms and three maids’ rooms. Monthly maintenance is $7,000.

The deal, made in mid-March, surprised some in the real estate industry. “I can’t believe it sold for that!” said one broker. Another commented that the apartment has “pretty views, but it needs work.”

Mr. Toboroff was represented by Helen Dreyfuss of Brown Harris Stevens.

1185 Park Avenue

Four-bed, four-bath, 3,800-square-foot co-op.

Asking: $5 million. Selling: $4.750 million.

Charges: $3,262; 38 percent tax deductible.

Time on the market: two days.

IT HAS A COURTYARD AND WINGS 1185 Park Avenue is a vestige of old Manhattan. It is the only grand courtyard building left standing on Park Avenue. In the center of the building, which takes up the entire block between 93rd and 94th streets, is a giant arch that leads to a central garden with a driveway going around it. And in case residents forget the wealthy past, the doormen still dress in police uniforms, a lingering tradition started at the time of the Lindbergh kidnapping, when wealthy tenants feared for their own children’s well-being. The building has six separate elevator lobbies, which helps make a 185-unit building feel more intimate. Each elevator accesses just two units per floor. “The builders of 1185 Park were competing with townhouses in the area when it was built in 1929,” said Daniela Kunen of Douglas Elliman, who sold this 3,800-square-foot apartment with a central entry gallery and a bedroom “wing.” The buyers were a “sophisticated” couple and the previous owner was deceased.


311 West 83rd Street

Two-bed, two-bath, 1,100-square-foot co-op.

Asking: $795,000. Selling: $830,000.

Charges: $1,426; 60 percent tax deductible.

Time on the market: one week.

SOMEONE’S BEEN WATCHING BULL Nothing pisses off today’s young financial stars like hearing the word no. A mutual-fund salesperson of the single female variety had lost out on two apartments when she trained her sights on this duplex apartment with a 700-square-foot terrace and its own brick barbecue pit. Refusing to strike out a third time, she offered the sellers $15,000 more than they were asking. “She was like, ‘I want the sellers to know I am not fucking around,'” said their broker, Joe Souza of the American Real Estate Group by Mika Sakamoto. But Mr. Souza had already scheduled an open house for a few days later, where a recent Columbia grad offered $32,000 more than the asking price. Luckily for the investment banker, the sellers felt she would have a better chance of passing the co-op board than the student. They told her that the place was hers for $830,000. She said it’s a deal, and the sale closed on Aug. 16.


95 Vandam Street

Two-bed, two-bath, 2,150-square-foot condo.

Asking: $850,000. Selling: $840,000.

Charges: $560. Taxes: $360.

Time on the market: three months.

KEEPIN’ IT RAW About five years ago, an artist and a writer bought this condo–when it was completely raw space–and adapted it into a home for themselves. They created two bedrooms, an office for him and a studio on a raised platform for her. They put maple floors in the living room, and painted the concrete elsewhere. About a year ago, however, the artist got claustrophobic and the couple bought a townhouse in Brooklyn where they will start from scratch. “They are basically the kind of people who can do gut renovations,” said their broker, Jewel Buff of Douglas Elliman. The guy who bought this apartment from them–he’s single and works on Wall Street–is the kind of person who wants a place where he doesn’t have to change much. “He himself does not need the artist studio,” said the broker. “But he may turn it into a music studio.” Look out, Paul Allen.

822 Greenwich Street

Two-bed, three-bath, 1,750-square-foot co-op.

Asking: $1.2 million. Selling: $1.125 million.

Maintenance: $2,242: 66 percent tax deductible.

Time on the market: six months.

MARKDOWN ATTRACTS START-UP GUY It was their dream apartment–two stories, three fireplaces, a balcony and a garden, all in the West Village near the border of the meat-packing district. But the dream job was in California. “They were devastated,” said Deirdre Poe of the Corcoran Group about her clients, who had to leave this co-op for the West Coast. It took five months, but they got $1.1 million for the place, which helped them get over leaving. The apartment is in great shape, a mixture of old and new: exposed brick walls, “gorgeous” kitchen, brownstone details, new bathroom. But “the maintenance was kind of high and we figured that might be a block for somebody,” said the broker. They dropped the asking price from $1.3 million to $1.2 million, then settled for even less from an Internet start-up guy who thought he had plenty of cash to spend on hefty maintenance fees. Flying the Co-op: $20 Million Houses Lure City Mommies