501 Beale (www.SocketSite.com)
Yet another Watermark penthouse has been wholly taken back by the bank and returned to the market. Purchased for $1,180,000 in November 2006 ($1,046 per square foot), 501 Beale #PH1D has been listed for $1,065,000 ($944 per square). 501 Beale #PH2D a floor above was purchased for $1,350,000 in October 2006 ($1,197 per square).
Keep in mind that 501 Beale #PH1B which had been purchased for $1,300,000 in October 2006 ($1,275 per square foot) sold this past February for $893,000 ($876 per square foot) while 501 Beale #PH2B which had been purchased for $1,375,000 in December 2006 ($1,349 per square foot) sold last October for $950,000 ($932 per square).
The 31 percent declines in value from to 2006 to 2009/10 for #PH1B and #PH2B might suggest a bit of optimism on the part of the sellers of #PH1D today (currently listed at a 10 percent discount below 2006). At the same time, the 13 percent discount in purchase price for #PH1D versus #PH2D (versus the 5 percent discount between #PH1B and #PH2B) might suggest a relatively good basis to begin with for #PH1D in 2006.
∙ Listing: 501 Beale #PH1D (2/2) – $1,050,000 [MLS]
Still Not Cheap, But 31 Percent Cheaper: Watermark Penthouse #1B [SocketSite]
A Pair Trio Of Bank-Owned Penthouses Atop The Watermark [SocketSite]

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Comments from “Plugged-In” Readers

  1. Posted by lol

    10% discount?
    I think it will move when the discount reaches 25%. That brings us to a 885K price. That’s already a lot of dough for a 2/2 with NO ADVERTISED SQUARE FOOTAGE (this usually translates into small) and $757.81/month in HOA dues. Hey you have a view, but these 70s-looking boxes make me feel like I am sleeping in my office building.
    Anyone interested in plunking 7K/month to live there?

  2. Posted by Paul Hwang

    lol,
    It’s interesting that you mention the rental market, it has really heated up the last month. Although we don’t really specialize in rentals, we have had some interesting stuff rent in the last month:
    ORH 2 BR+ Den 56th floor $10k per month
    ORH 2 BR 51st Floor $6000 per month
    ORH 1 BR 38th Floor $3200 per month
    Met 1 BR 9th floor $2500 per month
    Met 2 BR 9th floor $3700 per month

  3. Posted by lol

    I didn’t mention the rental market, though you could compare the 7K/month with what it would rent for (and you should if you want to buy anything in this city in this merciless market).
    The rents you provide are very informative. Any ideas about potential incentives (like one or 2 months free rent)? Plus, what is the square footage? Also 51st and 56th floor are also very exclusive at ORH, right? Probably not 1M-range condos. Then we go down to earth with the lower floor.
    The main reason for buying these units 3 years ago was hope for appreciation. Now people who are on the market also want to actually live there, which crops out specuvestors. That’s a more down-to-earth market, and that’s a good thing. Too much speculation can wreak havoc to residential buildings.
    I still stick with my guesstimate: way under 1M.

  4. Posted by Paul Hwang

    lol,
    Sorry about that, I thought the $7k per month was referencing rental. I would think it would be closer to $6k as a rental.
    ORH 54th floor 1577 sf 51st floor 1265 sf ORH 1 br 765 sf Met 1 br 600 sf Met 2br 980 sf
    Just a couple of months ago there were quite a few units for rent at Infintiy and One Rincon, there seems to be far less today.

  5. Posted by tipster

    ^Dodges the question:
    Any ideas about potential incentives (like one or 2 months free rent)?

  6. Posted by lol

    6K looks pretty high considering the rents in ORH/Met. I’d be surprised if it would rent even the 5s.

  7. Posted by hangemhi

    active rental market could be due to potential buyers choosing to rent. still those are good rents – maybe free gym access and door man when you don’t have to pay the HOA fee means a lot to renters.

  8. Posted by Legacy Dude

    This building was/is the posterchild of the Soma condo bubble. I’d guess at least half the original ’06 sales were for “investment” purposes rather than folks buying a place to live. It’s good to see that kind of behavior getting the outcome it deserves, and even better seeing prices returning to reality.
    Regarding this particular unit, I would also be surprised if it rented for more than $5K/month. Here’s a similar place a few floors lower asking under $4K/month:
    http://sfbay.craigslist.org/sfc/apa/1879934595.html

  9. Posted by Embarcadero

    Those rentals may have been short term, long-term, month-to-month, furnished or unfurnished. They may be rented by a corporation for a relocation.
    I love the way Paul, the RE “professional” throws out these numbers as though they were in any way transparent.
    Rental market “really heating up”? I guess that’s one way to look at buyers with cold feet.

  10. Posted by lol

    legacy dude, great find.
    CL’s advertised rents can sometimes be negociated, often “mitigated” with incentives. The asking $3995/month looks like the $199.99 pants that are priced not based on value but pure marketing. Of course behind the 3995 there is a landlord who probably grossly overpaid.
    With my 7K/monthly cost of ownership guesstimate, this would bring us to the good old “rent is twice cheaper” ratio that I see almost everywhere in SF.

  11. Posted by Paul Hwang

    Embarcadero,
    One year leases Kornfoolio! And no deposits were kept illegally!

  12. Posted by Kathleen

    I begged and pleaded, on clients belhalf, to purchase a penthouse, while under development,
    (I personally always despised the office park-y windows on this building) but the sales office defered me to an internet waiting list of thousands and a discouraging we don’t need your buyer relationship 1% coop.
    Biggest developer mistake of the new millenium.
    Undevealuing buyers agents on the ground.
    I rented a penthouse, represented the renter, in this building at 10+K per month, a few years back.
    I an sure it was the max ever paid in this building.
    Without the cruiseship terminal to look down upon, it is a duck out of water.

  13. Posted by curmudgeon

    “Without the cruiseship terminal to look down upon, it is a duck out of water.”
    I do think that, despite the somewhat unfortunate architecture, this should be a good long term play to get in on cheap (I don’t know if that’s now, or during the next several years). Because it is inevitable that something is going to be developed on the parking lot, and hopefully across the street…both parcels that were part of the cruise terminal master development for this site.
    It is totally a duck out of water right now, but hopefully it will be knit back into the urban fabric, and you can’t deny that it’s a great location. (as long as you’re facing the water…forget facing the bridge!)

  14. Posted by ellbee

    “Without the cruiseship terminal to look down upon, it is a duck out of water.”
    If the America’s Cup base goes into Piers 30-32 it could do wonders for 2/2 rents for a few years. Each syndicate would kill for a few nice apartments within walking distance.

  15. Posted by SocketSite

    The list price for 501 Beale St #PH-1D has been reduced 4 percent from $1,065,000 to $1,018,880.

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