Purchased for $650,000 in March of 2016, the 545-square-foot, one-bedroom unit #206 at 870 Harrison Street, which was built by JS Sullivan in 2015 and features “floor-to-ceiling windows with an open layout creating a modern and open living space,” along with a Bertazzoni range in the kitchen and “abundant closet spaces throughout,” returned to the market priced at $699,000 in September of 2021, a sale at which would have represented total appreciation of 7.5 percent since the first quarter of 2016 or a little over 1 percent per year.
Reduced to $675,000 after a month on the market, the “well designed” unit was then listed anew for $675,000, reduced to $649,000, reduced to $639,000, and then relisted anew for $629,000 last July, after which the one-bedroom, which comes with a monthly HOA fee of $697, was delisted from the MLS and offered for rent at $2,899 per month.
Listed anew for $589,000 at the beginning of this year, a price which was reduced to $549,000 in February and then to $525,000 last month, the resale of 870 Harrison Street #206 has now closed escrow with a contract price of $515,000, which is officially “within 2 percent of asking!” according to all industry stats and aggregate reports.
At the same time, the resale of 870 Harrison Street #206 represented a 20.8 percent drop in value for the contemporary condo on an apples-to-apples basis while the frequently misreported index for “San Francisco” condo values is “still up 13 percent” over the same period of time, having dropped 17 percent over the past year.
And quite simply, that’s why new developments aren’t penciling, particularly for developers with high cost bases for their sites/land.