Palms (555 4th Street) Courtyard
Purchased for $562,000 ($853 per square foot) in January 2007, the Palms (555 4th Street) #540 is now bank owned and back on the market asking $376,646 ($570 per square foot).
At the same time, the non-bank owned 454 square foot one bedroom #447 which was purchased in August 2006 for $395,000 ($870 per square foot) remains on the market after 132 days, currently asking $375,000 ($825 per square foot).
Six other one-bedrooms in the Palms are currently listed for sale with asking prices ranging from $430,000 for the 691 square foot #733 which is currently in contract as a short sale (purchased for $645,000 in August 2006, listed for $589,000 in February 2009) to $579,000 for the 682 square foot #714 (which has been listed for 74 days).
UPDATE: Although all the details were correct, we originally misidentified unit #447 as #337 (since corrected). That being said, according to a plugged-in reader the unit is actually a studio despite its 132 day old MLS listing as a one bedroom.
∙ Listing: 555 4th Street #447 (1/1) 454 sqft – $375,000 [MLS]
∙ Listing: 555 4th Street #540 (1/1) 660 sqft – $376,646 [MLS]
∙ Listing: 555 4th Street #714 (1/1) 682 sqft – $579,000 [MLS]
Pushing Forward With Price Discovery At The Palms (555 4th Street) [SocketSite]

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Comments from “Plugged-In” Readers

  1. Posted by J

    Lower prices are good, but now the HOA + parking fees seem insane when considered as a percentage of the total.

  2. Posted by zig

    squat ugly building. Why was this approved?

  3. Posted by anon12

    what a big surprise, just look at that courtyard.

  4. Posted by condoshopper

    hoa, parking, and prop tax adds up to around $1000/ month and that’s for the studio and 1 bed units. too many frivolities in the building including “business center”, movie theater, yoga room, lounge with TV and billards; i’ll leave the gym alone since it’s healthy.

  5. Posted by condoshopper

    Hi Editor, the referenced unit #337 is actually #447 and it is a studio not a one-bed despite what the listing says – i’ve been in there.
    [Editor’s Note: Cheers (and see UPDATE above).]

  6. Posted by anon12

    I wonder if grrr owns that studio?
    The Palms is taking a lot of hits from the web. Even their Yelp Review isn’t all positive which is rare for a condo project.
    http://www.yelp.com/biz/the-palms-san-francisco

  7. Posted by EBGuy

    Baghdad by the Bay — seriously, is that the Green Zone or the Palms courtyard? Looks like you could set up checkpoint Charlie there if the terrorists invade. Can someone help me out here; does this look much better in person or am I not refined enough to appreciate the the subtle references to WWII batteries scattered along the California coastline.

  8. Posted by justin

    Some project designers seem to want to try ANYTHING so that residents can pretend they do not live in San Francisco. I am not a fan of Miami or Orange County, but at least they do this type of landscaping and MUCH better.

  9. Posted by Willow

    I’d be interested to hear what residents who live in the Palms have to say. Those yelp reviews are overall pretty positive. I agree with EB Guy that the courtyard is horrific.

  10. Posted by The Milkshake of Despair

    EBGuy – Those concrete planters for the palms are not merely decorative. They are chicanes designed to slow down vehicles. So if a terrorist tries to drive a truck bomb in there, the snipers have a good chance of taking out the driver before they get too close.
    This is an amenity.

  11. Posted by Joe

    If they want to make it look like SF, they should pay some homeless people to shizz in the planters.

  12. Posted by perplexed

    They marketed this development as “Miami in San Francisco.” But if wanted to live in Miami, wouldn’t I just buy a condo in Miami?
    I will say that these price drops do seem to resemble the price drops in the Miami condo market!

  13. Posted by Langtonian

    I’ve never been inside, but I think this is one of the more attractive buildings in the neighborhood. Nice use of tile, nice-looking lobby (at least from the outside). A million times better than the Beacon.

  14. Posted by SFhighrise

    “They marketed this development as Miami in San Francisco. But if wanted to live in Miami, wouldn’t I just buy a condo in Miami?”
    No, because Miami doesn’t many career options or good wine. Does it ever occur to you that maybe some people prefer the trendy/minimalist feel to the antiquish Victorian look?
    I had a friend that rented in The Palms for a while. I thought it was pretty nice. It wasn’t over the top nice, but for $367k, I think that’s a pretty good deal. Its also walking distance to Mission Bay, which is becoming a pretty nice area and its good for commuting.

  15. Posted by Chad

    I don’t know about you, but this *fake* location setup is soooo unlike San Francisco.
    It sucks and I ha8 it !

  16. Posted by Oakland Chap

    Is it me or is the lobby not so bad? It looks well done. I know, no-one lives in the lobby but… why did they do such a good job on the lobby and not the units? The gas connections being on the top floors only is very weird. I once lived at the Essex and visited an open house unit at a Penthouses; after I moved out and learned that they have gas ranges on top of 20 floor and all other units do not! I don’t understand the thinking; maybe someone can comment with some background knowledge / or are they just being cheap?

  17. Posted by Poor in PacHeights

    Having Gas ranges on only the top or upper floors has to do with venting. You have to externally vent the kitchen exhaust fan if you have a gas range. If you have an electric kitchen it can be one of those recycling exhaust fans (air doesn’t go outside).I think it’s expensive to run vents from lower floors to the roof. But I don’t understand why the don’t just vent them hoizontally to an exterior wall on the Unit.
    Disclaimer – this is what I was told when looking at the Potrero where the 2 first floors are electric and the top 2 are gass.

  18. Posted by EBGuy

    Here’s my informal “pent up supply” report for the Palms:
    #602 – foreclosed in June for $376,416 (670 sq.ft.). Originally bought for $589k in Sept. 2006.
    #103 – currently listed for $299k (475 sq.ft.). A NOD has been filed for $320k.
    All things considered, not too bad…

  19. Posted by Outsider

    The Montgomery, if I remember correctly, have internal recirculating vents but the studios have electric cooktop while the rest have gas. The Millennium, SF BLU and The Infinity all have external venting and gas cooktop regardless of floor. Think they all vent into the central shaft and with the exhaust pulled out by large roof fans.

  20. Posted by invented

    OK since someone else referred to the planters… My first impression — ominous and creepy courtyard. If you can’t plant in the ground, don’t put trees in planters. It looks painfully forced. Same for planters in Peace Plaza J-Town with the propped up gingkos. Of all dignified trees to be put in planters! I wonder if this is the building which we see from 80 w/the silly palms on the roof.
    To restore the courtyard, the palms and planter things need to be removed for a more welcoming human-scaled courtyard. (imo)

  21. Posted by condoshopper

    re venting horizontally through the walls: it is possible that it’s possible to vent through the walls but that there are restrictions on how close such vents can be to openings such as doors and windows and the property lines; since the building seems to have lots of doors and windows and balconies, it could have been difficult to fit in vents with the required clearances.

  22. Posted by OneEyedMan

    Ding, Ding, Ding. Condoshopper gets it right. There are code restrictions on clearances from exhaust vents to doors and operable windows. There is also the issue of cooking smoke/grease that makes horizontal discharge turn the areas below the heavily used kitchen vents very dirty very quickly. There is no code restriction that says hoods over gas stoves must be vented to the exterior. Gas and electric are treated the same. It’s a cost thing too. In addition to the ductwork to the roof and the shaft around it it takes about a 2’x2′ area out of every unit for the stack. 4 sf @ $800 per = $3,200 more for unit. Gas is more expensive to install, especially if the range/cooktop is the only gas appliance in the unit. All that piping just for one thing. Much less to add a 220V circuit to the electric panel. Probably gas on the upper floors to help justify the floor-to-floor premiums being charged for the higher units. Don’t know what that’s worth now, but they were likely charging a $10K a floor premium when this building was being sold. Usually gas-fired water heaters and boilers are located on the roof so there’s already pipe being run that high.

  23. Posted by grr

    These small handful of re-sales are simply the worst units in a building with more than 300 homes. Not represenative of much, actually. The Palms has a great location. Lobby is stylish and standard furnishings are as good as (or better) than anywhere. Home + locations is what makes a great place. The courtyard is for the units that face the courtyard, nothing more. While it doesn’t jazz me, everyone I take thru there (especially at night) is wowed. And not “san Francisco-looking?”…whatever that means…..who the f*ck cares. Everyone I know loves it. To each his own. Fact is, this is a more than three year old condo that basically sold out. And, anon12 (jesse)…your obsession over trashing The Palms is likely due to your own inadequacies….that I have no doubt.

  24. Posted by armando

    ALSO — Condoshopper: Very curious about your estimate of S1000 a month for HOA and prop tax for these studio and small one-bedroom homes. We live in a 2-bedroom on the 8th floor and our HOAs+parking are $525. That’s paltry compared to most condos, especially one with a full-time lobby attendant, concierge, fitness center, etc. And to roll property tax into that is odd and misleading, esp. since property tax is was it is, and doesn’t really concern the development.

  25. Posted by condoshopper

    Hi Armando,
    caught your message just before leaving. I like to add HOA + prop tax + parking (if it’s additional cost like it is here) as a mental note because those are costs that will be around even after paying off the bank. so just as an example, the studio (which is featured as a 1-bed in this article) has HOA ~450, plus ~150 for parking, plus ~400 prop tax (about 1.2% per year right?). that’s how i got 1000. and even though these costs are the norm in SF i pointed it out to see if anyone had feedback, since i’m in the market for a condo.
    in your case you pay $525 HOA with deeded parking which is even less than $600 for the studio after parking is paid for, so you’re getting a better deal in this aspect especially considering you have 2 bedrooms while living in a studio feels like living in a closet. of course the unit price may have had a premium for the deeded parking.

  26. Posted by Outsider

    Still not quite sure why the frequent trashing of the Palms on SS. Not a great development but not any worse than most. 170 Off Third may be even less desirable IMO but has managed to stay off the bashing.

  27. Posted by Fish

    I’m not a fan of Palms either, but $376k for #540 seems rather reasonable. You’d be paying around $2000 to rent it, about same as buying. I’d check it out if I weren’t too particular about the views.

  28. Posted by Oakland Chap

    condoshopper & OneEyedMan, thanks for the replies related to gas / range. The glass ‘window walls’ at the Essex was the only ‘out’ to the exterior so you are accurate.

  29. Posted by jaja

    To afford #540. You’ll need to make about $145k a year.
    With 20% down, interest rate at 5.25%, 30 yr fix, RE tax, lease car space, and HOA due, your monthly payment is: $2676. We are suppose to spend 33% of our take home on house payments. Which means take home pay per month = $8100 after tax. If the tax rate is about 33% yearly, that means before tax, your monthly pay check is $12,089. Take that figure x 12 months. You get $145K. Kinda sad you have to make close to 150K a year and you get to stuck in a 660 sqft box. Dunno….. Seems a bit pricy to me.

  30. Posted by pwb

    The Palms always struck me as ill-conceived. It’s a modest building that fairly successfully convinced initial buyers that it was nice and I think they are the ones getting burned.

  31. Posted by mdonohue

    @jaja
    When using the 33% figure for housing costs, it is applied to gross (pre-tax) income. So you are inflating your estimate by factoring in income tax. Most NY apartments use a 40x on the monthly rent as a yearly salary requirement. Applying that here results in a salary of 107k. Pretty reasonable income to own in SF.

  32. Posted by mdonohue

    @jaja
    When using the 33% figure for housing costs, it is applied to gross (pre-tax) income. So you are inflating your estimate by factoring in income tax. Most NY apartments use a 40x on the monthly rent as a yearly salary requirement. Applying that here results in a salary of 107k. Pretty reasonable income to own in SF.

  33. Posted by mdonohue

    @jaja
    When using the 33% figure for housing costs, it is applied to gross (pre-tax) income. So you are inflating your estimate by factoring in income tax. Most NY apartments use a 40x on the monthly rent as a yearly salary requirement. Applying that here results in a salary of 107k. Pretty reasonable income to own in SF.

  34. Posted by San FronziScheme

    33% of gross is the number touted by professionals who live on commission. Who can blame them? The bigger the indebtedness the bigger the commission! They help create more debt, cash out their cut and who cares if the buyer will have problems down the road. One BIG reason we are in trouble today is because of this train of thought: pump, dump, repeat, retire.
    33% of net is the upper limit for a regular human being. Anything more and you have to either live under your income standards or grossly overstretch. Sure a 150K/Y could buy a 1M 2/2 condo at 2007 prices. The same guy could live in a 3/3 house for 500K in 1998. The only difference is banks had lowered their standards.
    Good to see these standards are making a comeback.

  35. Posted by Mike

    I checked this property out due to lower prices, but it’s just not going to appreciate in price.
    The building is of lower quality construction, the location isn’t anything special, and there are no views.
    You’re better off investing in a nicer building in a better area…or an improving area (e.g. Folsom). There are several good properties such as: Arterra, Blue, The Met…Infinity if you can afford it (1 block from the bay, wow!)

  36. Posted by joh

    @Willow
    The reason why those Yelp reviews are “overall pretty positive” is probably because the only people reviewing them are people who liked them enough to overpay there. Not to mention that those very same people want to protect their investment by not bad mouthing it on a social website.
    Does anyone know how much does it cost to rent a parking space at the Palms?

  37. Posted by joh

    Nevermind my last question. I just noticed that condoshopper answered it earlier.

  38. Posted by mdonohue

    @San FronziScheme
    33% of gross is cited by living wage folks, and was the standard applied by mortgage issuers before the real estate bubble. It is widely accepted that exceeding that figure results in a dramatic increase in the probability of default.

  39. Posted by San FronziScheme

    I never said it was illegal or not “industry standard”, just that 33% of gross was riskier. For most 33% of gross will be more than 1/2 of net which is way too much for many, especially since other housing costs will eat up 10%+ of your paycheck. Overall this means ~2/3 of your pay? RE professionals love these numbers…
    Along with the 30-Y scam (which helps you gain a bit in affordability, but at what cost?), these are 2 “standards” that are maximizing industry profits and making homes mechanically more expensive.
    I bought quite a few places and the mortgages were never more than 15 years, often 5 years, and my indebtedness was hovering at ~35% of net. How did I do it? Bigger downpayment! 50% financing worked pretty well. Less money to the bank ultimately means more money in MY pocket.
    Better pay yourself than a banker hog in NY or a college drop out salesperson.

  40. Posted by J

    mdonohue,
    Why should someone making $107k/yr be motivated to lock 1/3rd of their income and a $63.6k downpayment for a studio? You can rent something 2x that size for $2,700/month so it is not even close to making sense. Plus you are taking on the risk of further decline in value and/or earthquake.

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