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How to Sell a $75 Million House in This Economy

Bring on the Chinese.

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The grand staircase of 22 East 71st Street, a five-story limestone townhouse, $75 million.
Brokers: Serena Boarman and Meredyth Hull Smith, Sotheby's International Realty.  

Aby Rosen owns Lever House and the Seagram Building, but he doesn’t want to own this mansion on the Upper East Side anymore. Built in 1922, the house has been leased out since Rosen bought it in 2004—to the infamous Lawrence Salander, who ran his Salander-O’Reilly art gallery here. Four years later, the gallery’s bankrupt, Salander’s headed to court, and Rosen has set his price at $75 million. New York asked Meredyth Hull Smith and Serena Boardman, the senior vice-presidents at Sotheby’s International Realty who are handling this sale, exactly how they handle such a property as Wall Street’s melting down. To hear them tell it, it’s no problem.

How do you approach selling a house like this?
Smith: Each house of this magnitude is a stand-alone property. Things come into play—what it looks out on, the width of the house, the importance of the façade. And then of course in New York, size is always a premium. This is a 45-foot-wide house, and the gross square footage is over 20,000—one of the largest in the city. The house has very rare commercial zoning as well.

Meaning a retail store could move in?
Smith: An Hermès, Ralph Lauren, merchant bank, hedge fund—you can run a business through this townhouse. This could be another Rhinelander mansion.

Then who’s your buyer? The economy is so unsteady …
Boardman: People from all over the world. People from the Middle East, from Asia, Latin America, India, Russia, all over the place, are looking.
Smith: It tends to be very low-key, private wealth, and they want the best. They want the best location, and the best properties, and with the Frick and other major single- family mansions on an unusually low-rise block, all of that tends to drive the value to an unprecedented level.
Boardman: It is very rare to have a block to the north and to the south that is quite low.
Smith: The other house of this ilk was 25 East 78th Street, which Michael Bloomberg bought. That was a Stanford White house, and that sold for $45 million two years ago.

Will last week on Wall Street change any of that?
Smith: Buyers for a house like this are largely unaffected by Wall Street cataclysms.

Don’t they have second thoughts about whether real estate will be a good investment?
Smith: The laws of supply and demand still hold, regardless of the market cycle. It will be very difficult to find another property with the same stature since so few still exist.
Boardman: The record-selling price for a residential apartment is a little over $8,000 a square foot. The record commercial-townhouse price is right about there, too. So if you look at the metrics of those two numbers, you start to see that yes, $75 million really does comp out.

The sale isn’t the end of it, though. What would it cost, on top of the $75 million, for someone to bring this house back to single-family use?
Smith: I think, to be conservative, comfortably north of $10 million.

And buyers don’t balk at that either?
Boardman: If you knew who they were, you would not be surprised.


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