CFAH

San Francisco's Ritz-Carlton Residences (www.SocketSite.com)
Asking $2,090,000 for the 1,545 square foot two-bedroom in January of 2008 ($1,352 per square foot), the Ritz-Carlton Residences sales office is now offering 690 Market #1701 for $1,399,000, that’s $906 per square foot and 33% off.
In related resale news, the listing for the 2,090 square foot three-bedroom #1404 is now advertising “Over $500K price reduction! Make an offer!” on an asking price of $2,590,000 ($1,239 per square foot).
∙ Listing: 690 Market #1404 (3/3) 2,090 sqft – $2,590,000 [MLS]
∙ Listing: 690 Market #1701 (2/2) 1,545 sqft – $1,399,000 [MLS]
Reductions And Returns At The Ritz-Carlton Residences (690 Market) [SocketSite]

Comments from Plugged-In Readers

  1. Posted by tipster

    So everyone who bought last year just lost 30% over what they would have lost walking away from their deposits?
    Think of how smart you’d feel if you were one of the smart ones who waited and now can purchase the same thing you walked away from for 1/3 less!
    Or how much smarter you’ll feel next year at 50% off.
    The fools who posted last year that the upper end was immune sure must feel like idiots now. 33% off!
    And as these price drops pressure prices all over the city, just wait until you see what will happen to property prices elsewhere in response!
    It’s going to be a long, cold winter in SF!

  2. Posted by BayAreaBum

    2bdr ours for 33% off but >$30k per year HOA! that still seems pretty steep at over $2500 per month just in HOA

  3. Posted by San FronziScheme

    These have virtually very little value as an investment. HOAs again are killing the party…
    $2467.00 HOAs for #1404 (the $30244.00 HOAs for #1701 are an MLS fluke, no doubt)
    OK, you have 24h beret-wearing bouncer-style concierges (they put 2 at the front I guess just in case one has to pee) and 24h valet parking (2 valets as well? After all they have needs too).
    Gone is the Peter Coyote presentation on the flat screen that made me feel a cheetah was about to pounce from the Wachovia window on my way to work.
    Anyway, if you’re a crooked CEO/bankster fearing for your life, that’s exactly the place. They even have the wardens/bouncers/concierges at the front to get you accustomed to “24h security”.
    They could try to go rental. May I suggest 8500? or 8995? $8888 is a lucky number I hear. Whatever the amount, that’s a train wreck in the making. Soon at a bankruptcy sale near you.

  4. Posted by LMRiM

    Why these cuts? I guess they’re running out of price insensitive buyers. The people who bought last year can congratulate themselves on not having to be concerned with 30+% declines like the peasants have to be.

  5. Posted by Trip

    Yes, but the HOA fees appear to cover the “daily complimentary breakfast.” First time I’ve ever seen that. May be a deal for some competitive-eater-in-training who can scarf down about $100/day in breakfast.
    Spotted an interesting letter from the head of Pacific Union on this market segment — he agrees with tipster!
    http://www.dailypundit.com/sfrealblog/2009/08/a_rare_honest_moment_in_writin.php#023894
    [Editor’s Note: Avram Goldman Speaks Then (2006) And Now (2009).]

  6. Posted by viewlover

    that’s the kitchen? it’s smaller than a closet.

  7. Posted by Conifer

    How bright do you have to be to figure out that living downtown on Market Street should not cost more per square foot than Pacific Heights?
    That these developers have to reduce their prices should surprise no one.
    Before they went into this, they could have looked at comparable locations in other cities.
    Do people living in New York, on Times Square pay the same price as people on Fifth Avenue or Park Avenue?
    This has less to do with the recession than it does with Location Cubed, although the recession did not help.

  8. Posted by San FronziScheme

    Trip,
    Thanks for the link.
    From Avram Goldman:
    The upper end is not immune to price declines, it has just been slower in coming.
    He’s got it right. I could pull a lot of posts where the usual bears have said it all along. But there’s no point. Things are happening pretty clearly now.
    Conifer,
    I think they priced it that way because they knew it was a unique location with no close comparison. Sometimes I look down on Market from my office and dream of having a nice pad in one of the classical buildings, except they’re all offices. Then again, my commute from TH is short enough and I have a garden. I can also see One Ecker from up there which is another clusterf@ck only it happened sooner. 74 New Montgomery smartly lowered their prices and that has finally helped move the inventory. Most of these miscalculated both the top of the market and the rate of descent.

  9. Posted by Conifer

    San FronziScheme wrote
    “Sometimes I look down on Market from my office and dream of having a nice pad in one of the classical buildings, except they’re all offices.”
    But would you pay a premium of 1/3 above the PacHts or Telegraph Hill price to live there? Nope, you would expect to pay 1/3 less, since the neighborhood is burdened by homeless and panhandlers and other devotees of Chris Daly. That is why they need so much more security than tall apartments on Russian Hill.

  10. Posted by Walkman

    So if 17th floor units are going for ~$900/sq ft at the Ritz, what’s the comparable $$/sq ft in Soma and South Beach?
    The views may be better at ORH or Infinity, but do they justify the same price at similar floor levels ?

  11. Posted by San FronziScheme

    Conifer,
    I do not think this is even worth 80% of PH/TH for the precise reasons you gave. But they are providing a service. The segment is people who want to live in a hotel-like setting but in always the same unit, the same furniture (yours) plus a mortgage and the usual constraints of ownership.
    I never understood the concept of these places. I understand that hotel companies still want the steady income but want to sucker people into unloading them of some non-revenue producing costs, but on the buyer side the biggest draws are prestige and the services you’d get in a high end chain.
    Why not simply living in a suite for that price? Take your cash and buy some shares of the parent company if you want to feel you “own” your hotel suite. You won’t have to worry about utilities, plumbing, property taxes, remodeling, and so on. Have the hotel do that for you efficiently and swiftly. Plus it’s easier if you get tired of the hotel and the view… Just pack your bags and get another suite.

  12. Posted by G-man

    $1.4mm for a “kitchenette” just so you can tell people you live at the Ritz. Yup, the bubble is still with us.

  13. Posted by D Wilson

    San FronziScheme – Well said 🙂 I want to add that any view gets old. I find that only ‘new’ guest to my home enjoy my view that I paid so dearly for (not including taxes); regular guest seem to not care. I find myself closing the blinds 60% of the time! Oh man…

  14. Posted by skier

    I’ve been a guest there many times, and they do have some great service. Like an earlier comment said, “its for people who like living in a hotel environment.” Great gym, nice staff, COOKIES, valet service, free coffee/light breakfast, ability to order room service or drinks.
    BUT…does the HOA include daily maid service?
    Don’t forgot to add “tips” to your HOA dues.
    Hell, my HOA has a guy vacuum the common areas on Fridays 🙂

  15. Posted by bgelldawg

    Those “views” are depressing. Nothing but buildings staring you in the face. No water, not a single tree, none of the big landmarks. They’ve got some nerve hawking these as “view” units.

  16. Posted by Conifer

    Skier says COOKIES. Wow!
    You can get them also nowadays at some banks for free.
    Such luxuries. No wonder people want to live in the Ritz Carlton. With incentives like that, they will sell out immediately.
    Who came up with that brilliant marketing strategy?
    Like Chris Daly and brownies.

  17. Posted by soma resident

    So, does this mean that the Millenniumm will eventually cave? How can you expect people to pay $1600/sq foot plus $1800/month in HOA dues for a 2000 sq foot place when you can buy at the Ritz for 25-35% less than that and walk across the street to the real sports club LA?

  18. Posted by tipster

    The nicest gyms in SF are under $250 per month, and they are a hell of a lot nicer than this gym.
    The reality is that this place is for people who feel the need to let everyone know how important they are, and are willing to pay for that privelige. The views, kitchen, etc were secondary considerations. Just like the solar panel house in the marina is for people who want to shout how green they are, and are willing to pay for the privelige.
    I’m guessing there aren’t a lot of them left, and what people are willing to pay.is way down.
    Pac Heights and RH had their share of wannabees, so I don’t think those areas are immune, but this was a somewhat exrreme case.

  19. Posted by OneEyedMan

    Soma asked:
    “So, does this mean that the Millenniumm will eventually cave?”
    Yes, I predict that faced with this extreme level of competition that Millennium will be forced to introduce free cookies before the end of Q309

  20. Posted by condoshopper

    hey i clicked on the mls link for unit #1701, the HOA fee is $30244.00
    [Editor’s Note: Annually.]

  21. Posted by Outsider

    “Think of how smart you’d feel if you were one of the smart ones who waited and now can purchase the same thing you walked away from for 1/3 less!
    Or how much smarter you’ll feel next year at 50% off.”
    I wanted to buy General Electric at $10, didn’t pull the trigger, thought how smart I was when it dipped below $7. Held out some more for a soon to be $5 price. Kicking myself now at $14.
    I wanted to buy Wells Fargo at $13, didn’t pull the trigger, thought how smart I was when it dipped below $10. Held out some more for a soon to be $6 price. Kicking myself now at $25. True story. Hind sight is always 20/20…

  22. Posted by Robert

    Outsider, did have a valuation model for your price targets? If you keep adjusting your fair value estimates based on the charts, then it’s not a good sign. You may not always be right in valuing the assets, but if you don’t at least have statistical edge, then stop trading. If you do have an edge then stick to it, unless new information comes along. Also if you really want to buy at a price, you can write some puts.

  23. Posted by Outsider

    Robert: I am merely responding to the very first post by Tipster. Too bad there is no easy puts or call to buy or sell in real estate for individuals.

  24. Posted by lol

    1404 has now been lowered to 1.995M, 600K [less] than the August asking price.
    Square footage is listed at 2046sf. How did this unit lose 44 square feet? Shrinkage? Maybe they walled in the salesmen’s pride in one in the closets to get this unit sold?
    Less than $1000/sf. Back to earthly realities.

  25. Posted by lol

    #1404 was originally listed for 3.095M. A 35% haircut. What a deal!
    On another note, HOAs are now $2,833.72/month. Some would call it a rent. Again, what a deal!

  26. Posted by tipster

    Remember when 906 psft was a shocker? How cheap that was when $1200-$1400 was the norm!
    Now: $795 psft is the current ask! And if I had to guess, this one sells for something around $750 psft.
    http://www.redfin.com/CA/San-Francisco/690-Market-St-94104/unit-1502/home/21967222
    Keep waiting for 50% off, you whiners!

  27. Posted by A.T.

    This is how it works. Foreclosures mount and then foreclosure (or short sale) prices become the market prices.

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