1. BUILDING OVERVIEW (ANALYST FRAMING)
Building Type: Postwar Condop (Vintage 1948)
Scale: 93 Units / 12 Floors
Classification: Yield-Oriented
Justification: Park Gramercy behaves as a high-velocity rental utility that has completely decoupled from the broader market's appreciation trends. While the NYXRCSA benchmark has climbed to record highs (Index ~330 in Nov 2025), resale values at 7 Lexington Avenue have stagnated or regressed. Long-term holders (2013–2025) are realizing flat nominal returns, and cycle-peak buyers (2018) are realizing significant losses. The building's value is derived entirely from Rent Capture, where it consistently commands $76–$80/SF with exceptionally low vacancy intervals, functioning as a fixed-income bond proxy rather than a growth asset.
Sponsor Normalization Disclosure:
Transactions Reclassified: 0.
Context: The building is a mature resale asset (built 1948). No sponsor-driven bulk sales or "1-day DOM" anomalies were detected in the provided dataset (2005–2025). All metrics reflect pure secondary market behavior.
2. UNIT MIX & COMPOSITION
The inventory is overwhelmingly weighted toward small units, creating a "turnover machine" profile.
Studios: ~50 Sales recorded (~54% of activity).
1-Bedrooms: ~35 Sales recorded (~38% of activity).
2-Bedrooms: ~3 Sales recorded (<4% of activity).
3-Bedrooms: ~1 Sale recorded (<1% of activity).
Analysis:
Liquidity Stability: The building is almost entirely dependent on the studio/1-bedroom market.
Rent Capture: The lack of large units forces the building to function as transient/professional housing, which maximizes price-per-square-foot yield (smaller units rent for higher $/SF) but increases turnover frequency.
Volatility: The asset lacks the stability of "end-user" family inventory (2-3 beds), making it sensitive to investor sentiment.
3. LINE (STACK) PERFORMANCE — RESALE ONLY
A. Liquidity (Speed) There is a distinct liquidity inversion where larger (1-bed) units sell faster than the cheaper (studio) units.
1-Bedrooms: Median DOM 44 Days (Fast).
Studios: Median DOM 74 Days (Moderate/Slow Drag).
2-Bedrooms: Median DOM 22 Days (Sample size too small to trust, but indicates scarcity demand).
B. Price Strength & Dispersion
Building Median PPSF: ~$1,109.
Line Dispersion:
Premium (1-Beds): Median PPSF ~$1,263. (e.g., PHG sold for $1,472 PPSF in Dec 2024).
Discount (Studios): Median PPSF ~$1,036. (e.g., 2E sold for ~$900s implied in 2019, 3H sold for ~$1,000s).
C. Appreciation Negative to Flat.
Performance: Buyers entering around 2013 are exiting in 2024/2025 with near-zero nominal gains. Buyers from 2018 are realizing double-digit losses. The building has failed to capture the post-COVID inflation reflected in the NYXRCSA.
4. BUILDING-WIDE PPSF TREND (NORMALIZED)
Phase 1 (Growth): 2005–2015. Consistent appreciation. PPSF rose from ~$900 to ~$1,400.
Phase 2 (Peak): 2016–2018. Sales cleared $1,300–$1,450 PPSF regularly (e.g., Unit 2A at $1,394 PPSF).
Phase 3 (Correction): 2019–2023. Prices softened.
Phase 4 (Current Stagnation): 2024–2025. PPSF has reverted to ~$1,100–$1,250.
Comparison: While NYXRCSA is at ~330 (Nov 2025), this building is trading at 2013 levels.
5. RENT CAPTURE ANALYSIS
A. Rent Capture by Unit Type This is the building's strongest pillar. Rents are high relative to purchase price, and leakage is minimal.
1-Bedrooms (approx. 900 SF):
Rent: ~$5,800–$6,000/mo.
Rent/SF: $77–$80/SF.
DOM: Extremely Fast (6–13 Days).
Example: Unit 7G (Feb 2025) rented in 6 days at $6,000 ($80/SF).
Studios (approx. 550 SF):
Rent: ~$3,500–$3,900/mo.
Rent/SF: $76–$79/SF.
DOM: Fast (20 Days).
2-Bedrooms (approx. 1,650 SF):
Rent: ~$10,500–$10,750/mo.
Rent/SF: $78/SF.
B. Effective Rent Calculation (Example)
Unit 7G (Feb 2025):
Achieved Rent: $6,000/mo.
DOM: 6 Days.
Effective Annual Rent = $(6,000 \times 12) \times (365 - 6) \div 365 = $70,816$.
Capture Rate: 98.3% (Elite).
6. B³ SCORING SYSTEM (0–100)
A. Liquidity Score: 72
Speed: 1-Bedrooms are very liquid (44 days). Studios drag the score down (74 days).
Depth: Transaction volume is high relative to building size.
B. Rent Capture Score: 88
Efficiency: ~$80/SF is strong for a 1948 vintage.
Absorption: Rental DOM is frequently single digits (6, 7, 13 days). Income consistency is high.
C. Appreciation Score: 30
Magnitude: Multiple data points show 0% or negative nominal returns over 5–10 year holds.
Durability: Poor. The building serves as a "value trap" for appreciation seekers.
7. COMPOSITE SCORE & CLASSIFICATION
Composite Score = 61
$(72 \times 0.35) + (88 \times 0.30) + (30 \times 0.35) = 25.2 + 26.4 + 10.5 = 62.1 \approx 62$
Category Assignment: Yield-Oriented
Criteria: Rent Capture is excellent (>75), but Appreciation is failing (<50). The building is an income utility.
8. TRANSACTION EXAMPLES
Resale Depreciation / Stagnation (The "Lost Decade")
Unit 2A (1-Bed):
Buy: $1,325,000 (May 2018)
Sell: $1,185,000 (Jan 2024)
Result: -10.5% Loss (Nominal) in 6 years.
Driver: Market Regime Timing. Bought at the 2018 peak; sold in a high-rate environment.
Unit 3H (Studio):
Buy: $750,000 (Oct 2013)
Sell: $785,000 (Jul 2025)
Result: +4.6% Total in 12 years. (CAGR ~0.37%).
Context: After inflation and closing costs, this is a significant Real Loss.
Driver: Market Regime Timing / Stagnation.
Unit 9A (1-Bed):
Buy: $1,300,000 (Jun 2013)
Sell: $1,300,000 (Oct 2019)
Result: 0% Gain (Flat) in 6.5 years.
Driver: Market Regime Timing.
Unit 10D (1-Bed):
Buy: $1,375,000 (Feb 2014)
Sell: $1,375,000 (Jul 2015)
Result: 0% Gain.
Driver: Short-term Flip Failure.
Resale Appreciation (Historic/Long-Term Only)
Unit 12H (Studio):
Buy: $580,000 (Jul 2011)
Sell: $835,000 (Nov 2015)
Result: +44% in 4 years.
Driver: Market Regime Timing. (Captured the post-GFC recovery wave).
Unit 6D (1-Bed):
Price Context: Sold $790,000 (Sep 2009).
Comparison: Similar 1-Beds (e.g., 2A, 6G) now trade $1.1M+.
Result: Long-term hold (15+ years) yields appreciation, but medium-term (10 years) does not.
Driver: Market Regime Timing.
Unit 3C (Studio):
Buy: $629,000 (Dec 2008).
Comparable Sales 2025 (3H, 7H): ~$760k–$785k.
Result: ~+20-24% in 17 years. (CAGR ~1%).
Driver: Market Regime Timing. (Barely beating inflation).
Unit 5A (1-Bed):
Buy: $860,000 (Apr 2005).
Comparable Sales (2A): $1.185M (2024).
Result: +37% in 19 years.
Driver: Market Regime Timing.
9. RISKS & RED FLAGS
The "2018 Trap": Buyers from the 2016–2018 peak are underwater. Unit 2A (-10.5%) proves that the building has not recovered to those price levels.
Studio Liquidity Drag: Do not assume studios are "liquid gold" here. They take nearly 75% longer to sell (74 days) than 1-bedrooms (44 days).
Inflation Vulnerability: With a CAGR of ~0.3% to 1% over the last decade, this building is failing to hedge against inflation for asset owners.
10. EXECUTIVE SUMMARY
Park Gramercy (7 Lexington Avenue) is a pure Yield-Oriented asset that offers security of income but significant risk to capital appreciation. Post-resale data confirms that the building has effectively generated zero nominal growth since 2013, with recent sellers (Unit 2A, Unit 3H) exiting flat or at a loss despite the NYXRCSA benchmark hitting record highs. However, the building excels as a rental engine, commanding $80/SF for 1-bedrooms with single-digit vacancy intervals. It is an ideal "cash cow" for long-term landlords but a poor vehicle for wealth accumulation through equity growth.
B³ SCORECARD
Building: Park Gramercy (7 Lexington Avenue)
Category: Yield-Oriented
Composite Score: 62
Pillar | Score | Key Metric |
Liquidity | 72 | 1-Bed DOM 44 Days (Fast) / Studio DOM 74 Days |
Rent Capture | 88 | Elite Rents ($77–$80/SF) & Low DOM |
Appreciation | 30 | Flat/Negative 12-Year Trends |
Unit Mix Summary:
Studios: 54% of Sales (Liquidity Drag)
1-Bed: 38% of Sales (Liquidity Engine)
2-Bed+: <8% of Sales (Scarcity)