501 Beale#14D
Originally listed as a Watermark resale for $1,585,000 last July, from a listing later last year: “Views Galore 501 Beale #14D Offered at $1,499,000 Extraordinary price reduction!”
From a listing after that: “Buyers and Agents, now is the time to take advantage of this price!” Asking $1,399,000 at the time.
From the listing today: “Great Opportunity!! Take advantage of HUGE PRICE REDUCTIONs and 1 yr. HOA concession. Motivated sellers!!” Now asking $1,365,000.
And from public records: purchased for $1,303,500 in September of 2006 (not including any incentives). Cognitive listing dissonance (TM) is the first thing that comes to mind.
∙ Listing: 501 Beale #14D (2/2) – $1,365,000 [MLS]

42 thoughts on “Cognitive Listing Dissonance At The Watermark (501 Beale #14D)”
  1. From a “decent return” to a “close shave” profit to a “break-even deal”. I think we’re past break-even there to a “not so bad in this market” loss. At least they’re not frozen solid in their stance and you have to admire that. Smart people aren’t always right, but they see reality as it is.
    Location is great, view is really cool. How many sf?

  2. When are sellers going to realize that they’re still being dilusional? If someone bought a high-rise condo at the absolute peak of the market, they’re crazy if they think that the current market will bear them making a profit. Either take it off the market for a few years or soak up the loss. Buyers cannot and will not pay a ridiculous premium in this market.

  3. Are those views “forever” or destined to be obscured when the port decides to sell or build? does anyone know?

  4. Here’s my humble theory:
    $1,585 – let’s throw sh*t at the wall
    $1,499 – lets try cutting by 5%
    $1,399 – lets drop a whole digit like the guy at Walmart taking down the sign.
    $1,365 – seller negotiates a 4.5% commission to agent and sets price at exactly his “break even” over $1,303.5 buy price. Throws in HOA as a sweetener.
    I predict next 2 stops:
    $1,259 – let’s shoot for an even $1000/sqft
    $1,150 – let’s try for market price
    I love the psychology of asking prices.

  5. Whenever I see these kinds of sequential price reductions, I always think of that song by the Spinners (“I’m working my way back to you babe …”)
    Just trying to get back to zero, like those suckers at the blackjack tables in Vegas…

  6. The Watermark is a boutique luxury building, a little more intimate than the 300+ mega developments. People know each other, the staff is great, maybe one of the best in the city.
    It has a more feminine color pallette, light colors, exposed concrete in the hallways, good location on the Embarcadero, BIG parking spaces.
    The negatives; no mega complex type amenities (movie, conferrence, etc), a little loud outside because of the bridge, not much retail downstairs.
    Overall it’s a great complex for someone who has modern tastes, but wants to keep a low profile and wants to be in South Beach.
    Full Disclosure: I’ve got a really great, extra large 2 br 2 ba with huge wrap around patio coming out next week below $900K.

  7. Free listing price advice to sellers of cookie-cutter SOMA/South Beach condos:
    1) If you bought in 2004, list at your purchase price minus 5%.
    2) If you bought in 2005, list at your purchase price minus 10-15%.
    3) If you bought in 2006, 2007 or the first half of 2008, save us all the time of looking at your silly hail mary listing and give the keys to the bank.

  8. based on the pictures (on the Urban Bay website, not the MLS listing), I actually like this unit much more than others in the area that I’ve seen. The space seems to be laid out better than others, more suitable to live in.
    Is it worth asking price? probably not. but there are worse places around that are asking for more.
    I personally wouldn’t dream of buying a condo in this atmosphere… I dislike being linked financially to people I don’t know very well (HOA).
    but there are worse condos than this place.

  9. Chasing the bid down are we? Pro tip: If you really want to sell, you’re going to have to go lower than what you think “the next step down” should be.
    Markets are markets, real estate is not any different.

  10. Leaving aside discussions of inherent value, 2006 pricing, listing strategy, etc., there are scores of very nice places — SFRs and condos — all over the city in this price range, and I put this place in about the bottom 20% of those in terms of desirability. Nice enough views (but frankly, not nearly as nice as my own office!), but otherwise a pretty unremarkable place. $1,365,000 plus $770/mo HOA — no way, given all that is available in this market.

  11. No photos, and square footage “not available”. Is it so much to ask, for the agent’s tens-of-thousands-of-dollars commission, that they go through with a tape measure and a digital camera? How long can that take? 30 minutes?

  12. I think prices are down from the second half of 2008 as well, but probably not the full 20% that the seller had to put down.

  13. sanfronzi and jeffrey – look at the $1399000 link – you’ll see sqft listed at 1259, hence my prior comment.
    the agent is being paid tens of thousands of dollars NOT to publish the sq footage hoping there’s some sucker that won’t figure it out and pay $1084/sqft.

  14. Yes you are most likely right.. of course the bank appraisals 1) August and 2) December don’t communicate that but we all know how the system works..

  15. resp,
    Thanks. I should have done my due dilligence 😉
    Wow, that’s prime Pacific Heights pricing. Good luck to the seller. Still a good 400K to shed I think. The longer the wait, the deeper the loss as the market for condos is still on the way down.

  16. What about the second half of 2008?
    I’m guessing this was not an attempted flip on your part? If it was, you’re a few years late to the party…
    If it is due to life circumstances, I am either a) sorry to hear about your job loss, b) happy to hear about the job opportunity you got in a new city, c) happy to hear about your engagement/child on the way. It is unfortunate that you were hit with a change in your future expectations & needs so soon after buying a place. Unfortunately it is going to cost you just as much as if you were attempting to flip the place as the result (selling less than a year after you bought) is exactly the same.
    My gut would tell me you should list it at 10% less than what you bought it for and hope for the best. There is almost no chance you break even or make money on this transaction, unfortunately.

  17. I rent in the Watermark. It is a lower end building. Dirty elevators, poor quality, cheap furnishings. Great location if you need to get on the bridge. However, there is nothing in the building (even the penthouses) that deserves a 7 digit price. Besides, a large percentage of the building is for rent or for sale, so ignore the asking price and bid whatever you want. Eventually one troubled seller will crack and the entire building willg et re-priced to a more appropriate level. My guess is $600-$700- square foot. The bridge views are nice, but the noise is unreal.

  18. What I want to know is: why is the listing agent wasting his time. Perhaps the payoff is great in an unlikely event that it sells and it doesn’t cost him much to list. Will he invest his time to host an open house?
    It’ll take special people to pay $1.4m to live under a bridge.

  19. Balanced assessment? I live there. Big parking spaces? Yeah, right. Friendly staff? There is one woman and one gentleman who are wonderful. The building “manager” is like that guy from the Office. All procedure, no help. You can’t trust a real estate agent to be balanced.

  20. Price reductions have nothing whatsoever to do with cognitive dissonance. They’re about gradual acceptance of reality / abandoning delusion.
    When you try to be all smart and stuff… well, don’t.

  21. Drizzler, sorry I think I confused you. I do not own this unit. I was only asking if a person bought end of 2008 – in general what would the assumed discount be if they were to sell now. I bought in another building but not worried as I plan to be here long term, price and place were right for me.

  22. I knew you weren’t talking about this unit, but I did think that you had bought in the 2nd half of 2008 and now needed/wanted to sell. It sounds like you don’t, which is a good thing.
    If someone did buy in the 2nd half of 2008 my advice still holds – list it for 10% less than what you paid and hope for the best.

  23. As Fronzi notes, “Pac Heights pricing”. But actually, very, very few things sell for $1,000 per SqFt in Pac Heights. That’s why I’ve never been a fan of SOMA/South Beach…. a view of the bridge often means noise, and the neighborhood is still about 10 years from being a neighborhood I’d care to live in. Yet they’ve been charging a 20% premium to Pac Heights for 5 years now. It’s ridiculous.
    $1000 per SqFt should be reserved for views that are high enough above the bridge that you can open your windows, and for views that won’t be lost when a new tower goes up 10 years from now.
    Otherwise, SOMA/SB deserves no more than $700 SqFt when an equivalent Pac Heights place sells for $800 per SqFt.
    Per the MLS there were 26 2+ bedroom condos that sold for $1,000 per SqFt or more (when SqFt was listed) in SOMA/SB/MB vs. 16 in Pac Hghts/Marina/Cow hollow/Presidio heights since January 2008. And you know there were a TON MORE off the MLS in the Infinity and other non-MLS buildings. you can argue in favor of those buildings all you want, but the neighborhood has never deserved Pac Hghts prices in my opinion, and yet it sells for for a 10% to 20% premium (well it did, that’s changing)
    This one is worth $800 a SqFt at most which is about $1 million…. no matter how feminine the color pallette is… and I wouldn’t pay $700 per SqFt for it (if i had the cash and wanted to listen to bay bridge traffic – which i don’t)

  24. I wish I was able to more eloquently express my thoughts regarding this listing. However, as that is not the case, simply stated, I have two words:
    “crack” and “pipe.”

  25. sfrob,
    Agreed on your assumptions. To get more realistic the seller should drop the price to the low 900s and have buyers bid on the place. That’s price discovery in a bear market, instead of asking a wish price and waiting, waiting, waiting. Heck, someone might event pay a Mil who knows! If they wait some more, they’ll probably get less than 700/sf – way less.

  26. Gee, I live part time at the Watermark and all I can say is that my experience is pretty different from “Watermark Resident”.
    The furnishings (which I personally do not particularly like) are from DWR and though not really expensive are definitely not cheap. The lobby functions as a sort of gallery with work from a different local artist every two months which I find kind of cool. The staff is unfailingly friendly and helpful, as are my neighbors. My parking spot actually is huge, 10′ X 20′ with extra space all around it (but, to be honest, some spots are small and require the parking skills of an experienced valet parker). The finishes in my unit are nice, much better than what I have seen in other condos. The kitchen is OK for now. The bathrooms are great. My biggest complaint is that the louvered doors (at the aircon unit, the washer/dryer and some of the closets) are flimsy and that the door trim is some kind of wood composite – but hey when I remodel I’ll replace the doors and eliminate the trim entirely.
    With windows open the noise from the bridge is quite loud for the units that face it. It’s not so bad with windows shut as the windows facing the bridge are all triple glazed. My unit is on the other side and pretty quiet. When the weather is nice I leave the door to my balcony open all the time. I don’t think the D unit balcony is really useable though.
    One of the best things about the building is that noise from other units is nonexistent. You just don’t hear a peep. This is in very pleasant contrast to my previous SF place where you got a lot of bass from other peoples’ stereos and TV’s.
    Oh, and yes, the views are mesmerizing. It’s different from other bay views. Here you are so close to the water you feel like you can touch it.
    The current height limit for the rest of seawall lot 330, the Watermark’s block, is 105 feet (about 9 or 10 stories). 14D should clear that pretty comfortably. So even if something is built in front of the Watermark the views from 14D will still be pretty nice. You just won’t be seeing the parking lot anymore, which most would find an improvement.
    The D stack has a nice layout with two large bedrooms on either side of the living area. On the 14th floor I imagine the view of the bridge itself is pretty nitty gritty as you would be looking right at the side of it at all the cars going by, but I can see how some people might really like it.
    That said I can’t imagine how anyone would try to sell this unit at a price equal to or greater than what they paid for it given that the building came on the market right about at its peak.
    Cognitive dissonance? It’s pure denial.

  27. I find comments from the likes of Watermark Resident a million times more useful than some of the regulars. Thanks for the details.
    I suspected 14D was “gritty” in it’s views, so my $700 per SqFt comment is a high side.
    I do actually like the Watermark, and it’s location. It’s practically on top of the bay so it won’t lose views the way others will, but I’ve never thought it should have commanded Pac Heights prices – or rather premiums to Pac Heights.

  28. On the plus side this does have an appealing layout and a pretty decent sized living and dining area, which gives it an instant advantage over any 2/2 at the Infinity which all lack both of the aforementioned. The balcony is almost certainly not usable during the day, due to noise levels, although it would be awesome for fireworks at night. While the units are nice and close to the water, the cramped lobby and office building like exterior don’t really justify the premium. Accordingly, I can’t imagine this getting over $1000psf … I think around even $900psf would be great in this market, if they are lucky.

  29. This balcony would be perfect for greenery. From the standpoint of this picture, a few nice chosen plants wouldn’t block the fantastic bridge views and would be in perfect contrast with the color swatches. Too bad about the noise though.

  30. I know this has been posted before on SS, but what ‘public records’ can one use to look up historical purchase prices?

  31. “The current height limit for the rest of seawall lot 330, the Watermark’s block, is 105 feet (about 9 or 10 stories). 14D should clear that pretty comfortably.” This guarantees a future developer will build at least 105 feet, and more if he can obtain a variance, which he will certainly try to.

  32. If a developer tries to get a variance from the 105 foot height limit he/she will have the whole neighborhood screaming at every possible hearing. There’s actually a move afoot to get the height limit reduced to 45 feet – and it’s not just Watermark owners. Don’t know how well that is going, though.
    I know that applying for frivolous variances is the public’s expectation of developers. But I have been an architect in San Francisco for 30 years and the none of the developers I have been involved in projects for have ever even contemplated such a move. On the other hand, building right up to 105 feet? It’s a given.

  33. Variances seem to be the rule in my neighborhood:
    – 1634 160 Pine St. – zoned 130′, 240′ requested (on the ground that once the density variance from one unit per 200 sq. ft. to one unit per 125 sq. ft is granted, the building doesn’t fit within the 130′ height anymore).
    – 1481 Post St – zoned 240′, 405′ requested.
    – Cathedral Hill Hospital _ zoned 130′, 290′ requested.
    Perhaps you don’t work with the most “daring” developers (and I would add, good for you, as I am sure they are “daring” with their architects as well).
    On a different note, I really like the Watermark, and it is a nice confirmation to hear an architect likes it enough to call it home.

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