It Takes a Lot to Build in the Village: Swaths Selling for $20.2 M. ($45.4 M. With Townhouses!)

There are all kinds of cheap vacant lots. (There’s even a good song about them—it goes, “He’s so drunk he’s passed out in a Datsun/ that’s parked out in the hot sun/ in the saddest vacant lot in all the world.”) But the real estate market is so glittery in Manhattan now that nothing, even a large piece of nothingness, is ever inexpensive here.

Consider the 80-foot-long vacant lot called 22-28 Downing Street, near Bedford and West Houston. In July 2004, it sold for $2,625,000 from its longtime owner to a real estate developer, and then three years later it sold to a developer named Gary Sherman for $10.54 million.

Nothing has changed, but late last week Mr. Sherman put that same vacant lot on the market, split into three sections, for a total of $20.25 million (or about $6.75 million each). And for $45.4 million he’ll sell you the lot with three fully built houses. The future townhouses, each five floors and around 6,250 square feet, have been listed individually for about $15 million.

Records show that he and the last owner both applied for new building permits, but didn’t get consent from the city. On an application in September, Mr. Sherman’s designer is listed as David Piscuskas of 1100 Architect, a firm with clients like Harrison Ford, Jasper Johns and mammoth financier Dan Loeb.

“They’re not 100 percent approved,” Elliman listing broker Leonard Steinberg said about the townhouse plans. “They’ve not been turned down either—there are just a few modifications to make.”

Three separate buyers will probably buy the lot’s three future townhouses, though on the other hand there has already been an inquiry from a family about buying one townhouse for the parents and two for the two adult children. What about the large price tags? “I know it’s not a bargain,” the broker said, “but it’s actually not badly priced.” That’s hard to argue with, considering that most $15 million townhouses in the neighborhood still need pricey work.

And a more modest buyer could just take one of the cheapest lots—23 feet wide and $6.5 million—and build something less expensive than what Mr. Sherman has planned. “And here comes the other miracle,” said Mr. Steinberg. “You don’t have an existing structure, so you aren’t as religiously bound by landmark rules”—which limit what can and can’t be renovated.

Asked about the potential for something unsightly getting built on the quiet street, Mr. Steinberg said no one wants something on Downing that “belongs on another planet. People are coming here to get something that’s Village-oriented.” Then why wouldn’t someone just buy an existing brownstone? “I think some people love classic old cars,” he said, “and some people like brand-new cars where everything works.”

It Takes a Lot to Build in the Village: Swaths Selling for $20.2 M. ($45.4 M. With Townhouses!)