Pursuing Perfection, One Massive Renovation At A Time

The paint had scarcely dried at 15 Central Park West before the building’s first residents set to knocking down the

Oaktree Capital’s Howard Marks bought his Ritz Carlton pad for $18.8 million in 2007. Now he’s asking $50 million. The excuse? A stunning renovation.

The paint had scarcely dried at 15 Central Park West before the building’s first residents set to knocking down the walls and stripping out the ultra-luxury condo’s ultra-luxurious finishes. Not that the finishes were lacking—like the layouts, they were widely considered to be exquisite—a stunning marriage of old-fashioned grandeur and modern sensibilities. In fact, ex-Citigroup CEO Sandy Weill thought that architect Robert A.M. Stern had done such a fine job designing the building that he hired him to do a massive renovation on his brand new, $43.7 million penthouse.

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In the upper echelons of Manhattan real estate, the pursuit of perfection is as common as Sub-Zero refrigerators and private elevator landings. Haunted by dreams of what could be, owners are forever tearing magnificent properties apart in the hopes of transforming them into even more magnificent properties.

Such dreams often pay off handsomely. To wit, Mr. Weill’s freshly-renovated penthouse was so striking that it fetched $88 million shortly after completion. But of course, it would surprise no one, particularly not Nicholas S.G. Stern, son of A.M. and the owner of boutique construction concern Stern Projects LLC., if the Russian tycoon who bought the celebrated spread started his own renovation any day now.

“If you have an extraordinary property, with unique features—location, terraces—and you put in a great deal of money to enlist a top-end architect, that’s when an apartment turns into a trophy,” said Mr. Stern, who is an experienced polisher of such trophies. With the collaboration of architects, interior decorators and a small army of craftsmen, Mr. Stern has turned both gutted apartments into pristine spaces and already pristine spaces into different, possibly more pristine spaces. His handiwork includes not only the penthouse at the Ritz Carlton (listed for $95 million), but also a downstairs spread listed for $50 million. At the moment, he is in the process of transforming two thirty-fifth floor apartments at 15 CPW into a single, sprawling gem with a $95 million price tag. “By giving it the royal treatment, you are, in fact, legitimizing it as a property in this uber-arena,” Mr. Stern explained.

Remodeling has always been popular among those with means, of course, but while it once took the form of fresh chintz patterns, these days it often hews closer to gut renovations.

“I’ve been in lots of places where they’ve spent gazillions to renovate and the next buyer comes in and totally redoes it,” said appraisal guru Jonathan Miller of Miller Samuel. “On one hand, what makes these properties trophies is the fact that they’re done. But then they’re gut renovated or totally redone to suit the new owners’ taste. It’s a strange dynamic, but right now that’s the very top of the market. Clearly people are willing to pay a premium for a home that’s finished.”

Brown Harris Stevens broker Paula Del Nunzio said that one of her renovated listings in 15 CPW sold for several million more than a nearby apartment in the same line.

“A renovation can add a great deal of value if it’s done in a classic manner that would appeal to an international standard of taste,” she said, adding a word of warning: “no idiosyncratic features designed to the taste of just one owner.”

Besides the thrill of winning a prized pad, there is a practical component to buying a newly-renovated home—even if it isn’t the next buyer’s idea of exquisite, it is likely closer than the unrenovated alternative. And certainly, there is a comfort in knowing that one could move in, if compelled by necessity, with only an interior decorator in tow. Renovations do require a significant investment of time and money, particularly with summer work hours, the limited window that many co-ops restrict construction to, forcing homeowners to wait out the other three seasons idly.

“A renovated apartment holds a great deal of attraction—we live in a city where it takes six weeks to upholster a pillow,” said Brown Harris Stevens broker John Burger. “A renovation really takes at the bare minimum six months and a good renovation can take 18 months.”

Mr. Burger also confided that buyers might want to avoid undertaking a massive renovation as they are widely known to “take a bit of a toll on relationships”—a phenomenon that Mr. Miller also remarked on. “Eighty to ninety percent of the divorce-related appraisals I’ve done are in the middle of a renovation,” he told us. “And if it’s not the Manhattan apartment, it’s the house in the Hamptons.”

We shuddered, along with Mr. Miller, at the thought of trying to sell a partially-renovated home in the midst of a divorce. And we couldn’t help but wonder—why would anyone spend months and wads of money, not to mention risk their marriage, to re-do an apartment that had literally just been redone?

“It’s the dream,” he responded. And sometimes it’s the nightmare. Renovations done by the former owners can be, well, infelicitous to put it mildly.

Mr. Stern, for one, admits to having seen some questionable aesthetic choices. What you might call distinct, but not distinctive.  Not that taste has anything to do with his job, he added—his role is to make sure that the client’s vision is assembled beautifully. No matter how hideous that vision might be.

“Certainly I’ve seen things that that I would not encourage my friends to live in,” he said. “This is the world we live in; there’s no limit to bad taste. And this is New York—there is always someone who will hold your hand while you throw money out a window.”


Pursuing Perfection, One Massive Renovation At A Time