As we outlined earlier this year, unit #2E at 288 Pacific Avenue, “the perfect SF pied-a-terre” and “urban home in a beautiful full-service building…directly across the street from the Battery Club,” returned to the market priced at $1.045 million early last year, a sale at which would have represented total appreciation of 13 percent since the 392-square-foot studio was purchased for $925,000 in the first quarter of 2018, not accounting for the cost of a number of subsequent upgrades, including new lighting and built-ins to create a separated bedroom.

Reduced to $995,000 after a few months on the market and then to $895,000, the luxury unit was then withdrawn from the MLS and briefly offered for rent at $4,950 a month.

Relisted for $895,000 earlier this year and then reduced to $885,000 in May, 288 Pacific Avenue #2E has just been relisted anew for $835,000, a sale at which would be considered to be “at asking” and with only “1” day on the market as of today, at least according to all industry stats and aggregate reports, but would represent a 9.7 percent drop in value from the first quarter of 2019, not accounting for the cost/value of the aforementioned upgrades.

13 thoughts on “High-End Pied-à-Terre Relisted Anew at a Larger Loss”
  1. $1,227/month HOA fee for a studio is problematic. Assuming a 7% mortgage rate and a “market” HOA fee of $500 for a unit like this, the additional $700/month is equivalent to the payment on $109K in principal…which doesn’t amortize and cannot be refinanced at a lower rate.

    1. The HOA fee represents a fair value for the amenities in the building (this one has 24/7 lobby attendants) and the neighborhood, plus a bit of signaling priced in to capture that this unit is a “luxury pied-a-terre” and bargain-hunting members of the local penny ante mom and pop landlord class need not submit a bid.

      I don’t claim to be an expert on the market for studios in and around Jackson Square, but an HOA fee of $500 for a unit like this doesn’t seem to me to be a realistic expectation. Even if you were to search in the entire 94111 zip code, you’d find that the cheapest studio units on the market in the wider area have HOA fees running in the ballpark of $900 per month (see 240 Lombard St Apt 233, for example).

      1. Sure that may be average in the market for those amenities, but that doesn’t change the fact that it feels like too much for the value you actually get out of it. I love highrise housing, but these HOAs are just stupidly high to ever realistically consider it.

        1. Last time I went looking for a place, an elevator in the building added about $500/month to the HOA fees. I was told that’s so when the elevator craps out – which it will, someday – there will be enough in the reserves to fix it. That was 15 years ago. The elevator reserve portion of an HOA fee is probably higher now. Add the doormen’s salaries to maintenance, utilities, insurance, etc., and $1227/month doesn’t seem like an unreasonable number.

          It’s just, a lot of folks (like me) don’t value lobby attendants enough to pay for them. And most people who want the nice hotel experience will just get a nice hotel room. So it doesn’t seem to me there would be a wide market for a place like this.

          Could it make a profitable AirBnB? It looks designed for AirBnB, but could they charge enough to cover mortgage/taxes/HOA?

    1. Maybe if you’re smoking that hopium.
      As I said above, I don’t claim to know the market for Jackson Square studios, but I’m confident that if this unit closes anytime during the next sixty days, it will be for an amount significantly > $200,000. There is currently nothing on the market in the entire 94111 zip code for any property at even double that asking price, and I’m certain we’d need an armageddon, a residential real estate exodus dwarfing the post dot com bomb era to get close to that selling price. As of this writing, a BMR studio in the Book Concern building, near the Tenderloin, is asking around that amount, but little else.

      1. And in fact, the sale of 288 Pacific Ave Unit 2E did not, close during the sixty days following the change of asking price in the Fall of 2023. The listing was removed from the MLS in the middle of December, 2023. Collateral Analytics’ automated valuation at the last update was $827,990.

  2. Did a realtor — oops, Realtor (R) — really suggest that the seller “slash” the asking price by seven-tenths of one percent?

    1. For the percentage change (not the percent difference) between 835000 in September and the one described by the editor above: 829000, I get just over a 0.7 percent decrease.

  3. UPDATE: The list price for unit 2E at 288 Pacific Avenue has just been further “improved” to $795,000, a sale at which would be considered to be “at asking!” according to all industry stats, aggregate reports and “market scores” but would represent a 14 percent drop in value from the first quarter of 2019, not accounting for the cost/value of the aforementioned upgrades.

    At the same time, the two-bedroom unit #6C at 288 Pacific remains on the market with a reduced “asking price” that’s 13 percent below its value in 2018 despite sell-side (mis)reports of “positive market conditions” and “pivots” making the rounds.

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