In 2005 a bidding war left 199 New Montgomery “sold out.” Today a plugged-in tipster reports that Pacific Union is helping the developer move “more than 12 units” in the building, only a few of which are currently listed as inventory.
Reduced! At 199 New Montgomery [SocketSite]
SocketSite’s San Francisco Listed Housing Update: 3/16/09 [SocketSite]

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Comments from “Plugged-In” Readers

  1. Posted by jessep

    Yeah, their prices are really low.
    I’m not sure I understand your article but they were nice for the money. I’m sure they’ll move.
    [Editor’s Note: It helps to understand supply if you’re looking to demand.]

  2. Posted by jessep

    So people left their contracts and they a bunch of supply available?
    Step 1: Sold out/95% Contract
    Step 2: Bleep hits the fan?
    This is from the sales office or resales?

  3. Posted by steve

    Why would they wait 4 yrs to move the remaining inventory? People were bidding left and right in 2005; this makes no sense.

  4. Posted by auden

    maybe they have been kept by the developer as rental units, and he/she has now decided to sell them.

  5. Posted by Copernicus

    I have no inside information, but I do know the following. 199 New was built by Monahan Pacific (MP), the same builder of 246 First Street. MP also has a development of new, single family homes in Larkspur, right across from the Ferry Terminal (I don’t recall the name). The principals of MP take a large part of their development fees as equity in the project or individual units that they develop. With little or no basis in dozens of condo units, MP has made a mighy fine living renting out these units over the past decade or so. My guess is that the Larkspur project is not performing (selling) and the proceeds from these units in 199 New will be used to help carry debt at Larkspur. Just a guess.

  6. Posted by anonsf

    @ auden
    I bet that is correct. The same developer (Monahan Pacific) developed 246 Second Street and he kept a number of units there as well. So many, in fact, that that building (246) has always had too many renters.
    I looked at 199 a while back. There were some truly bizarre layouts (think kitchen alcove IN the living room).

  7. Posted by jessep

    I found that area a little too busy actually.
    Very urban though, but not my taste.
    I think it’s a high quality project but the sales staff is very aggressive. Be careful.

  8. Posted by chuckie

    There are six units on Redfin. 3 are listed with Pacific Union.
    All 6 seem to have come on the market recently.
    http://www.redfin.com/search#lat=37.786602&long=-122.399104&market=sanfrancisco&sf=1,2&status=1&v=4&zoomLevel=19

  9. Posted by FSBO

    Regarding Drakes Cove, the MP development in Larkspur, I think Copernicus may be right. Looks like they sold two units last summer, but none since. They are really pricey ($2M) duplexes. At least one new unit is for rent asking $5,500. Odd location unless proximity to death row is a factor. If you are considering that location because it’s only about a mile away from a really good high school (Gavin’s alma mater Redwood), think again. This development is in the San Rafael school district.

  10. Posted by condoshopper

    for price comparisons, a 1-bedroom (on the 7th floor) was on the market during Fall of last year and did not sell until it went off the market, then back on and asking price reduced to 499,000.

  11. Posted by 45yo hipster

    And just to ‘third’ copermicus’ comment, I believe the developer gains a tax advantage by keeping their profit in as rental units. Their cap gains is reduced, as they did not a cash profit, but their profit was (probably) free and clear units.
    Any accountants reading this that can confirm this strategy?
    I believe that most developers do not do this, as they see their strength in developing, cashing out, moving on to the next project. But perhaps MP Dev is a local firm and wanted to keep an equity ppsition in their portfolio. A smart move IMO, if they can pull it off.

  12. Posted by OneEyedMan

    Looks like the MP empire continues in it’s need for ca$h. Don’t know what’s going on at 199 New Montgomery, but at 246 2nd Tom just sold unit #1006. His personal penthouse unit there just went on the market for $2.45M. Also, the Spa on the ground floor had a for sale sign go up last week. Drake’s Cove must really be in a bad way.

  13. Posted by Bigfoot

    Has the market really improved?? What does Socketsite followers think of 199 New Montgomery #1001 at $774,900? Personally I don’t get it, especially when the penthouse level #1601 (same layout/size) sold for $704,500 back in September.

  14. Posted by Paul

    1001: bad one. next a roof (they may build more stories there)

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