Lofts: The One Bright Spot in the Real Estate Market

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Lisa Grus, Premier Realty Exclusive

Interest in lofts, like this $524,000, 3,000 square-foot space in St. Louis, is increasing.

Oh, a loft … who doesn’t want to live in a large empty space that can be customized to fit your needs? Loft properties can be especially appealing to empty nesters, whose aging knees may dictate a preference for all-on-one-floor layouts over those of classic multi-story houses. Lofts are often located in a city’s urban core, an area that can be revitalized and marketed with the promise of walk-to-retail that is missing from many traditional suburbs. Although the housing slump continues, in many parts of the country, there is a proliferation of loft development … from South Norwalk, Connecticut (nicknamed SoNo) to Cleveland to San Francisco to … St. Louis?

“Up until the last 15 years or so, the only reason that you lived urban in St. Louis is that you were in poverty,” says Chris Grus of Premier Realty Exclusive in St. Louis. He notes, though, that the appeal of city living improved, and that typical suburban homeowners became interested in urban living “right before the housing crash.” Those customers, Grus notes, didn’t sell their suburban homes and buy lofts immediately, “but waited to get 2007 prices [for their existing properties] in the suburbs.” Now, however, he says that “a lot of people are fed up with waiting.”

That the waiting is over seems to be the case in Manhattan, one of the few places where it’s possible to get specific loft statistics (in most submarkets “lofts” are simply lumped in with “condos.”) The volume of Manhattan loft sales increased 60% in 2010 from 2009 as previously recession-fearful buyers poured back into the market. Average price per square foot of those lofts, according to data provider Miller Samuel, was $1,113, up 82% from a decade ago.

However, house or apartment buyers who begin looking at lofts soon learn that these properties are a bit of a category unto themselves. With that in mind, check out these loft-shopping tips.

(GALLERY: Historical Thousand Island Homes)

1) Find the plumbing. “In a classic loft — a building that had a former life as non-residential use, whether that means a school, a power plant, or a factory — it’s important to know where the plumbing is,” notes Sandy Mattingly, an associate broker at Manhattan’s Corcoran Group and the author of the blog Manhattan Loft Guy. That will help you when you’re configuring your layout, because the easiest place to put “wet” rooms — a property’s bathrooms and kitchen — is near the existing plumbing lines. Mattingly notes that wet rooms can be placed away from those lines, but then you need to allow for secondary pipes to slope for drainage purposes. “If you’re in a loft, and you see a kitchen on a raised platform, that’s usually to allow room for pipes,” Mattingly notes.

2) Check the noise levels. There are two types of noise generators: from the outside and from your neighbors. As far as external noise is concerned, old windows are often replaced by the developer as part of a loft conversion, but double check just to make sure. And for internal noise, when a factory building is actually being used as a factory, noise transmission from one floor to another isn’t necessarily a problem. But when it’s a personal residence, it’s a different story altogether. Check to see what the building’s internal noise transmission is likely to be and what you might have to do to remedy it. I’ve worked as an agent in Manhattan’s trendy Tribeca neighborhood, and I’ve seen lofts where the buyer has to agree, as a condition of purchase, to soundproof the entire apartment — a proposition which can get expensive as it involves adding multiple layers of insulation.

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3) Look for the light. In a real estate ad, “double exposure” — meaning windows on two sides — might seem to guarantee good light, but you’ll need to go check the space out in real life. For one, in a crowded city, you’ll need to make sure you clear other buildings. “You could have one building where on the fourth floor and above, you can clear southern exposure. In that same building, you might have to be on the eighth floor and above to clear a west view,” notes Mattingly. You’ll also want to do due diligence to make sure that no developers are planning to put up a building in your line of sight.

4) Don’t forget the condo board. Grus, who sells converted factories and former industrial buildings, notes that “most of the buildings in St. Louis are condominiums.” Given that, he says, “how harmonious the condo association is, how well-funded, and how prudent they are — these factors are as important as, or even more important than, whether you like the space.”

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