The American Basements or now known as Brownstones or Townhouses in the Upper West Side were originally built as mansions for wealthy merchants to enjoy with their families and their servants in about the 1880’s to early 1900’s. A few decades later, the economy began to tank and things started to change.
During the great depression, most of these townhouses were divided into small units and some townhouses withstood bankruptcy by converting the single dwelling into single room occupancy(SROs). In the 1960’s, when the economy began to rebound, new owners scrambled to have as few tenants in their property as possible and had hopes of having their family enjoy the townhouse life as initially intended. Some new owners were content to collect the extra income and retain their townhouse as a rental property.
Today, most new townhouse owners are sticking to the original script and are converting their townhouse back into single family mansions. Some new owners go to great lengths to achieve their goal by either paying tenants of rent stabilized units a hefty sum of money to move out or by buying tenants of rent controlled units a condominium under the condition that a) the tenant will live rent free in said condominium until they expire, b) the condominium cannot be passed on to any heirs of the tenant, and c) the buyer of the condominium enjoys the full rights of ownership of the condominium once the tenant expires. To understand this phenomenon, know that on average a townhouse costs about $1,000 less per square foot than a new condominium.
Many townhouses sell at remarkable price tags beyond $1,000 per square foot so long as they are delivered vacant or have the potential to be vacant in order to convert the property into a single family luxury residence. The less fortunate townhouses are those that house regulated units, although they can fetch about $900 per square foot depending on where the regulated units are situated within the building.
Once conversions are complete, these single family mansions have the potential to sell for over $10,000,000. There’s a huge market for luxury single family townhouses in the Upper West Side mainly due to privacy. One example is of 226 West 71st Street. This townhouse sold in 2011 for $5,175,000 as an eight unit walkup boasting only 4,792 square feet. In 2014, the same townhouse, after a gut renovation and being expanded to a total of 9,400 luxury square feet with an elevator and hi-tech-top of the line-installations, sold for $14,000,000.
Alex S. Isak
Director of Sales | Upper West Side
Goldenwood Property Advisors, Inc.