Traditional co-ops are leery of decisions that will disturb residents—approving ambitious construction work, for example. Then again, the Franconia isn’t particularly traditional. Decades ago, mobster Arnold Rothstein ran his business from this building, brokering a deal here (known as the Franconia Treaty) with another branch of the Mob. And despite its brass-and-marble lobby and dreamy address (across from the Dakota), “it’s a classy joint but … not a ‘Good morning, sir’ kind of building,” says board president David Wineberg. And it’s groundbreaking, even: The Franconia hopes to be the first co-op to sell its rooftop for such a high price. The board is asking $8.7 million.
Rooftop penthouses have been added to buildings before, cake-topper-style, but usually by individual homeowners who want to expand upward. This deal is different, because shareholders are inviting outsiders to buy and build. To a point, anyway: It’s in a designated historic district, so the structure can’t be visible from the street, meaning it has to stand ten feet back from the parapet and rise no higher than two stories. Bottom line: The buildable space amounts to 4,000 square feet.
Why the gamble? In 1993, explains Wineberg, the cooperative took out an unusually rigid mortgage that couldn’t be paid down partially, refinanced, or split up. (Residents would like to convert the building into a condo, and the loan precludes that.) It also prevented the co-op from taking on extra debt, requiring punishingly high monthly charges. With thirteen years to go on the loan, the board wanted out, and to do so it had to pay off the mortgage entirely, all $8 million–plus of it. “They’re not doing it for a profit,” says listing broker Elie Khen of Bellmarc Realty. “Each dollar is spoken for.”
Still, $8 million will buy a fully finished townhouse in the area, so will someone bite? “It’s the location,” says broker-architect Moriah Kosch, who’s consulting on the deal. “To be able to customize with these views”—the building peeks into Central Park—“is a rarity.” Wineberg says most residents are onboard, despite the headaches ahead. After all, if they get the asking price, their maintenance charges could be cut in half. “They see the dollar signs,” he says.