Real Estate

The Power of Teamwork

When next-door neighbors sell jointly, one plus one can be a lot more than two.

By S.Jhoanna Robledo
Published Apr 27, 2008

(Photo: Alex and Lalia/Getty Images)

No one remembers who had the idea first, but that’s beside the point: The Aronsons and the Edmondses, whose Riverside Drive two-bedroom apartments (8A and 9A) sat atop each other, were both about to sell. So they entered the market at $2.995 million for the two properties, about right for the four-bedroom their apartments could become but easily $400,000 more than they could’ve expected to get separately.

Although the couples have since dipped their price, they were definitely onto something: This kind of teaming up is growing more common. The shortage of family-size apartments remains acute, and appraiser Jonathan Miller says larger spaces, once they’re put together, can command a 20 percent premium per square foot. Say you join two one-bedroom apartments that cost $600,000 apiece. For a modest contractor’s fee of maybe twenty grand, plus some headaches, you may produce a three-bedroom that’s worth $1.4 million. You’ve created almost $200,000 in equity out of thin air. Co-ops have even been known to sell common building space—like bits at the ends of hallways—to make those amalgamations seamless. “We do a tremendous amount of appraisals of common areas that would be co-opted if two units are put together,” says Miller. (Which is a reminder that the resultant floor plan has to be graceful. Two small apartments connected by a long zigzag hallway won’t see much love.) “It takes extra paperwork, it takes extra marketing, but it could mean extra money,” says Prudential Douglas Elliman’s Lorraine Iannello, who’s repping another paired property down the hall from the Aronson-Edmonds combo. (The smaller of that duo, a one-bedroom, is priced at $1.1 million, far more than it’d draw without its neighbor.)

Citi Habitats’ Phil Horigan, who has two adjoining one-bedrooms at 2250 Broadway, says the approach makes sense in what he admits is a “slower market.” The two sellers won’t have to compete for the same buyers, and they can draw in both starter apartment-hunters and families. “You want to present potential buyers with as many options as possible,” he says. In fact, it works to everyone’s advantage, even if the joint sale doesn’t happen. “If either of us gets a deal,” says Jennifer Edmonds, “that’s okay, too.”