interesting article from aspendailynews.com
Buyer of most expensive per-square-foot condo paid more to ensure keeping view
Even Aspen’s air space is worth a hefty price in the lucrative world of real estate.
The price on the record-breaking downtown penthouse sale that occurred last month was driven partly by the buyer purchasing the “air rights” above an adjacent building to ensure views of Aspen Mountain in perpetuity.
The sale of the 5,053-square-foot condo on top of the Muse building located at 625 E. Hyman Ave. for $15.8 million was the most expensive per-square-foot downtown penthouse ever sold. It pencils out to $3,126 a square foot.
“That is a record for a downtown penthouse for sure,” said Tim Estin, a residential real estate broker at Aspen Snowmass Sotheby’s Real Estate who writes a blog called Estin Report about Aspen homes and the market.
The Muse penthouse buyers bought the property from developer Nikos Hecht, who included the air rights above the building at 602 E. Cooper Ave., which is home to the Mezzaluna restaurant and is located south of the residential property. The penthouse’s rooftop deck is taller than the Mezzaluna building and has direct views of Aspen Mountain.
The deal for the air rights means that, in effect, no vertical development can occur on the Cooper Avenue property, which according to county assessor records is called Hunter Plaza. It is owned by downtown landlords Tony Mazza and Frank Woods who reportedly sold the air rights above their building to Hecht.
Craig Morris, the Sotheby’s International Realty broker who represented the buyer in the penthouse sale, said the deal also is known as buying a “view plane easement.” The dollar value of those air rights is not disclosed but Morris said it was “a lot,” and it was part of the purchase price. He also noted that it’s the first time he has seen or heard about such a deal.
City of Aspen community development director Chris Bendon said he has heard of buying an easement to a view plane but “it’s not common.”
It’s not just the air rights that contribute to the penthouse’s high price tag in terms of square footage — it’s also the size and layout.
“It’s a unique layout,” said Brandon Blocker, a Sotheby’s International Realty agent who also represented the buyer. “It’s 5,000 square feet all on one level and a deck ... and they bought the air rights so their view can’t be blocked.”
It is a four-bedroom, four-and-a-half bathroom penthouse with a rooftop deck and pool.
Bigger is better
The Muse penthouse is one of a handful of residential units in the commercial core that is larger than what the city code allows for, which is a maximum of 2,500 square feet.
“It’s a very special and unique property; it’s almost one-of-a-kind,” Blocker said. “It’s really hard to find in the core because of the square footage.”
Also a contributing factor is the fact that penthouses are no longer permitted in the commercial core as a result of legislation passed in 2012.
Before Aspen City Council passed that ordinance, several building owners submitted land-use applications that include the development, allowed by right, of up to 2,500-square-foot penthouses. These properties include the old Aspen Athletic Club, Charles Cunniffe Architects offices, the Garfield & Hecht law office, Zocalito and the Red Onion annex.
Two penthouses are under construction — at the corner of Spring Street and Hopkins Avenue by developer Greg Hills, and the other on Hyman Avenue which also is owned by Hecht, along with his father, Andy. The Aspen Core building, at the corner of Hyman and Hunter, will house two penthouse units at 1,500 square feet and 6,000 square feet. They are not allowed to be combined, Bendon noted.
Both Hyman Avenue penthouses — at the Muse and Aspen Core buildings — were borne out of negotiations with the city of Aspen. The Muse building, located next to the Aspen Art Museum, was allowed after Nikos Hecht sued the city for denying an earlier development proposal at the council table. The settlement resulted in two top-floor residences that were allowed to be combined, Bendon said, as well as the next-door Aspen Art Museum. The Aspen Core penthouses were negotiated in exchange for the Hechts not knocking down two now historically designated properties next door — the Tom Benton building and Little Annie’s Eating House.
“Penthouses are a diminishing asset in town,” Estin said, adding that as the number of those types of properties continues to dwindle their value goes up.
Bendon agreed.
“Fundamentally, the biggest factor is there are many more people who want that product,” he said. “That is the market solution for folks.”
More competition in the marketplace
Estin said the 14 townhomes approved on South Aspen Street, which are the alternative to a failed hotel development on the same site, are in direct competition with downtown penthouses.
“The OneAspen townhomes have added a wrinkle,” he said, adding the price per square foot for them hovers between $1,700 and $2,900.
Maureen Stapleton, a broker for Sotheby’s International Realty, confirmed that eight of the 14 townhomes have been reserved with a refundable $250,000 deposit. They went on the market in July and range between $8.5 million and $16.2 million. Their sizes are between 4,067 square feet and 5,722 square feet. They are expected to begin construction in the spring and be completed by June of 2016.
She noted that the townhomes are in the last prime location — not only walking distance to the downtown core but also at the base of Aspen Mountain. The site is also located near two city parks.
“We are so limited by growth and our surroundings,” she said. “That neighborhood is going to be fantastic.”
Posts
