CODA (385 FIRST AVENUE)

1. BUILDING OVERVIEW (ANALYST FRAMING)

• Building Type: Postwar Condo Conversion (Built 2002, Converted 2017)

• Scale: 103 Units / 20 Floors

• Classification: Yield-Oriented (Distressed Liquidity)

Justification: Coda (385 First Avenue) acts as a high-velocity rental engine that is currently destroying capital value for resale vendors. While the NYXRCSA benchmark has reached all-time highs (Index ~330 in Nov 2025), this building is experiencing severe Sponsor Premium Burn-Off. Resale transactions in 2024–2026 consistently trade at significant nominal losses (-10% to -25%) compared to 2017–2019 acquisition prices. The building’s value is derived almost exclusively from Rent Capture, where it commands elite premiums ($80–$97/SF) with rapid absorption, whereas the sales market suffers from deflationary pressure and drag in larger units.

Sponsor Normalization Disclosure:

• Transactions Reclassified: ~45 transactions from 2017–2019.

• Context: The building began closing converted units in volume in 2017. Many sales (e.g., 2E, 15C, 18D) show "No Listing" or short DOMs. These are treated as Sponsor inventory to establish the pricing baseline ($1,500–$1,700 PPSF).

• Impact: Post-sponsor analysis focuses on the 2021–2026 resale cycles.

2. UNIT MIX & COMPOSITION

The inventory is transaction-weighted heavily toward 1-bedroom units, creating a specific "turnover" profile.

• 1-Bedrooms: ~84 Sales recorded (~63% of activity). Dominant Inventory.

• 2-Bedrooms: ~40 Sales recorded (~30% of activity).

• 3-Bedrooms+: ~6 Sales recorded (<5% of activity).

Analysis:

• Liquidity Stability: The building relies on the 1-bedroom market for velocity. When this segment stalls (as seen in recent 130+ day DOMs), the building freezes.

• Rent Capture: The efficient footprints (1-Beds ~700–770 SF) drive high Rent/SF efficiency, maximizing yield.

• Volatility: The lack of a deep "end-user" 3-bedroom market makes the building sensitive to investor ROI requirements.

3. LINE (STACK) PERFORMANCE — RESALE ONLY

A. Liquidity (Speed) Resale liquidity is bifurcated and slowing. The median DOM for 2-bedrooms indicates a "stuck" market.

1. 1-Bedrooms: Median DOM ~50–90 Days (Moderate/Variable).

   • Fast: Unit 7F (31 Days, 2026), Unit 7H (23 Days, 2025).

   • Slow: Unit 11A (139 Days, 2025), Unit 18B (140 Days, 2024).

2. 2-Bedrooms: Median DOM ~150–200+ Days (Severe Drag).

   • Examples: Unit 2B (408 Days in 2022), Unit 9B (396 Days in 2020), Unit 16D (320 Days in 2021).

B. Price Strength & Dispersion

• Building Median PPSF: ~$1,200–$1,300 (Resale) vs ~$1,600+ (Sponsor Baseline).

• Line Dispersion:

  • Correction: Recent 1-Bed trades have compressed to $1,233–$1,266 PPSF (e.g., 11A, 7F).

  • Discount: This represents a massive discount from the $1,500–$1,600 PPSF achieved in 2017–2019.

C. Appreciation Negative. The building is in a "falling knife" cycle.

• Performance: 2017 Buyers are exiting in 2025/2026 with -10% to -25% nominal losses. This divergence from the NYXRCSA benchmark is extreme.

4. BUILDING-WIDE PPSF TREND (NORMALIZED)

• Phase 1 (Sponsor Peak): 2017–2019. Sales consistently cleared $1,500–$1,750 PPSF.

• Phase 2 (Volatility): 2020–2022. Mixed performance. Resales began showing cracks (e.g., Unit 9B taking 396 days).

• Phase 3 (Deflation): 2023–2026. Resale pricing has collapsed to the $1,200–$1,350 PPSF range.

• Current State: Distressed. While the NYXRCSA index rose from ~280 to ~330, Coda’s PPSF dropped significantly.

5. RENT CAPTURE ANALYSIS

A. Rent Capture by Unit Type This is the building's only functioning engine. Rents are elite and absorption is fast.

• 1-Bedrooms (approx. 720–770 SF):

  • Rent: ~$5,000–$5,350/mo.

  • Rent/SF: $80–$88/SF.

  • DOM: Fast (12–29 Days).

  • Capture: High.

• 2-Bedrooms (approx. 984–1,230 SF):

  • Rent: ~$7,850–$9,750/mo.

  • Rent/SF: $95–$97/SF.

  • DOM: Moderate to Fast (63–126 Days).

B. Effective Rent Calculation (Example)

• Unit 5A (Jun 2025):

  • Achieved Rent: $5,150/mo.

  • DOM: 13 Days.

  • Effective Annual Rent = $(5,150 \times 12) \times (365 - 13) \div 365 = $59,617$.

  • Efficiency: 96% capture of gross potential.

6. B³ SCORING SYSTEM (0–100)

A. Liquidity Score: 40

• Speed: 1-Bedrooms are inconsistent; 2-Bedrooms suffer from chronic drag (often 150+ days).

• Depth: Sellers are "stuck" unless they accept deep discounts.

B. Rent Capture Score: 92

• Efficiency: Rent/SF is exceptional ($80–$97/SF).

• Absorption: Rental DOM is healthy. The building works as a rental.

C. Appreciation Score: 15

• Magnitude: Proven deep nominal losses (-25%).

• Durability: The asset has failed to hold any of its conversion premium.

7. COMPOSITE SCORE & CLASSIFICATION

Composite Score = 49

• $(40 \times 0.35) + (92 \times 0.30) + (15 \times 0.35) = 14.0 + 27.6 + 5.25 = 46.85 \approx 47$

Category Assignment: Yield-Oriented (Distressed Liquidity)

• Criteria: Rent Capture is elite (>90), but Appreciation is failing (<20). The asset behaves like a depreciating asset that generates cash flow.

8. TRANSACTION EXAMPLES

Resale Depreciation (The "Sponsor Premium" Trap)

1. Unit 11A (1-Bed):

   • Buy: $1,270,000 (Jun 2017).

   • Sell: $950,000 (Dec 2025).

   • Result: -25.2% Loss (Nominal) in 8.5 years.

   • Driver: Sponsor Price Normalization.

2. Unit 7F (1-Bed):

   • Buy: $1,070,000 (Jan 2018).

   • Sell: $950,000 (Jan 2026).

   • Result: -11.2% Loss in 8 years.

   • Driver: Market Regime Timing.

3. Unit 2B (2-Bed):

   • Buy: $1,695,000 (Sep 2019).

   • Sell 1: $1,550,000 (Jan 2022) (-8.5%).

   • Sell 2: $1,510,000 (Jun 2025) (-2.6% from 2022).

   • Total Result: -10.9% Loss since 2019.

   • Driver: Liquidity Shift.

4. Unit 8B (2-Bed):

   • Buy: $1,700,000 (Jun 2019).

   • Sell: $1,625,000 (Apr 2023).

   • Result: -4.4% Loss.

   • Driver: Sponsor Price Normalization.

9. RISKS & RED FLAGS

• Capital Shredder: Buying a unit here has historically resulted in a 10–25% loss of capital for resale.

• Liquidity Trap: 2-Bedroom units like Unit 2B and 9B have taken over a year (396–408 days) to clear the market.

• Valuation Gap: Do not use 2017–2019 sales as comps. The true market value is ~$1,250 PPSF, not $1,600.

10. EXECUTIVE SUMMARY

Coda (385 First Avenue) is a Yield-Oriented asset with a severe "Sponsor Hangover." While the building generates elite rental yields ($80–$97/SF) with high efficiency, it has been a wealth-destruction vehicle for equity owners. Post-sponsor resale data from 2024–2026 confirms that buyers from the 2017–2019 conversion cycle are exiting at nominal losses of 11% to 25%, completely decoupled from the record-breaking NYXRCSA benchmark. The building is suited only for investors acquiring at the distressed $1,250 PPSF level for cash flow; it is a "do not touch" for capital appreciation seekers.

B³ SCORECARD

• Building: Coda (385 First Avenue)

• Category: Yield-Oriented (Distressed Liquidity)

• Composite Score: 47

Unit Mix Summary:

• 1-Bed: 63% of Sales (Core Volume, Loss on Sale)

• 2-Bed: 30% of Sales (Severe Liquidity Drag)