Palmer’s 280 Hicks at Auction or What’s it all about Alfie?

By on April 30, 2010 11:44 am in Real Estate

Alfred Palmer was a unique individual who owned 135 Joralemon Street in Brooklyn Heights.  He was by many accounts a “character” – a hoarder perhaps and someone who allowed 135 to tapdance on the edge of demolition by dereliction. After a fire nearly destroyed it,  that home was rescued by contractor Howard Haimes in 2006.

A Brownstoner commenter said this last year:

Alfred Palmer was a very interesting man. He was born and lived his entire life in the Heights. He had a group of dedicated, wonderful friends who loved his company and were very much upset by his dying on May 11, 2008.

He lived an exciting, full life and did just what he pleased and was not bothered by all the silly rumors about his houses. The Heights would be a better place with more Alfred E. Palmers.

Palmer also owned the carriage house at 280 Hicks Street.  It’s been unsuccessfully offered at auction a couple of times and on Tuesday (5/4), at 2pm at the Brookyn Supreme Court Building it’s up for bids again.  This time the auction for the property starts at $1.8 million.  An Open House for this and the other properties for the Public Auction will be held this weekend.  PDF info here.

BHB’s Heather Quinlan got an exclusive sneak peek of the property yesterday and reports back with this video.

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  • me

    1.8 for this mess? jeez

  • BH resident

    It should start not one penny over 350K.

  • milton

    I knew Palmer for many years. He was an anarchist, a hoarder, a bee keeper, and an all around eccentric. His father was a wallpaper hanger and a painter, back when paints had high levels of lead. Most painters were nuts back then, like hatters, who were poisoned by mercury. Palmer was probably a victim of childhood lead poisoning, or maybe not. He could have just been odd by nature. He inherited all his properties from his father. If he had married his longtime companion, who is a sensible person, this property could have been sold properly, but like I said, he was an anarchist and an eccentric. I do not believe the neighborhood would be better with more like him. On the contrary, there would be no neighborhood with more like him.

  • Karl Junkersfeld

    Nice reporting, thanks Heather. Was looking at that building last week while walking with my wife. Nice to get an inside scoop.

  • milton

    I just wish to add that this carriage house is a gem. A gem. It could be turned into a beautiful family home so easily. I hope someone buys it who can fix it up and take care of it. They won’t be sorry.

  • http://Robert HeightsGuy

    As Milton suggests, it could be a gem. But the real question is the pricing and the terms of sale. This property would require a complete gut renovation, which will take at least two years from purchase to finished product. The successful bidder basically needs all cash to buy at auction because the Public Administrator prohibits any contingency based on financing. Once you sign the contract, your 10% deposit if subject to forfeiture if you can’t close within 60 days. Would a bank make a loan for a rundown property such as this? Doubtful. Therefore, you need all cash.

    Plus the “successful” bidder not only buys the property “as is” physical condition without recourse to an engineer’s report, but also with all problems with title if there are any. Is there any time to do a proper title search *before* the auction? No. As the contract specifies, the highest bidder agrees to buy the property with all existing title restrictions, easements, covenants, liens, etc etc. This is not a problem in a normal sale because all such problems with title have to be resolved *before* a buyer would close on the property. However, the contract for this house specifies that the buyer has no ability to pull out of the deal even if problems with title are discovered. As they say: caveat emptor. Buyer beware!

    That said, the property itself obviously has good potential. I wonder if the firehouse causes a lot of noise? Does anybody know? I often hear the fire trucks blasting their sirens when they exit the firehouse, which is just three doors down from 280 Hicks.

  • http://Robert HeightsGuy

    Oh, the other thing that seemed odd about 280 Hicks was that it does not have a Certificate of Occupancy. I wonder what implications that would have for anybody looking to renovate it into a residential unit. If you renovate, would the house be reassessed at market price, which would then drive its property taxes well above $30,000 per year? There are a lot of questions about this property that make it difficult to comprehend at such an elevated price of $1.8 million. Maybe they should have started it at $1 million, which would have attracted buyers and then the real market value could have been determined when it sold to the highest bidder. At $1.8 million, there is a possibility of a repeat of the last auction when it failed to attract even one bid at $2 million. The $200,000 reduction is not that much when considering the risks involved in buyer such a high-priced property at auction.

  • nabeguy

    A property with no clear title and no C of O and no contingency clauses? Who would be foolish enough to risk even $1.00 on that?

  • http://Robert HeightsGuy

    I just looked at 280 Hicks out of curiosity. This is a massive gut renovation project. It really is a job for a serious contractor with extensive experience. And it will require deep pockets on the part of the owner. I still say that if they really wanted to sell this house at a fair market price, then they should have started the bidding at a recognizably low level near $1 million, which would have drawn in serious bidders. At $1.8 million minimum bid, I’m not sure how many people would be willing to bid at all.

  • http://www.alternet.com Lifetimer

    I don’t think someone who (deliberately?) allows his prime real estate to crumble into dangerous shanties is anyone to admire or emulate.

  • http://www.alternet.com Lifetimer

    Ooops, I’m Lifetimer2

  • http://Robert HeightsGuy

    Unfortunately, they did not allow people to view either the roof or the cellar. They said that the stairs to the cellar were rotted and therefore not safe. I can understand why they don’t want people on the roof because if it caved in, then there would be a huge lawsuit that would shut down the sale of the property. They only allow people to walk within confined corridors that were marked with yellow “danger” and “keep out” tape (i.e., the kind you see at a crime scene or other area where authorities block off an area). It was hard or impossible to see all of the floor area, walls and ceilings because there was so much junk taking up the space. They sealed off the 2nd floor front rooms. Plus, they did not allow access to the rear of the house, so it was impossible to judge the condition of the rear wall.

    Suffice it to say that these were not the best viewing conditions of a house that requires serious and careful inspection.

  • http://Robert HeightsGuy

    Oh, I forgot to mention that there was a big hole in the floor of the garage that they covered with plywood. I guess they didn’t want to lose any viewers to the unknown depths beneath the house!

  • GAO

    HeightsGuy, this property has been in the Palmer family since probably close to the turn of the century. C of Os were not required back then. In addition, the last sentence on page 4 of the terms of sale says that if the Public Administrator is unable to convey title, the down payment will be returned. If there are any problems with title, the administrator has to clear them up, not the purchaser.

  • http://Robert HeightsGuy

    GAO….On page 3, of the terms of sale, it literally states that “each property is being sold subject to all violations, any state of facts an accurate survey may show, covenants, restrictions, easements, and agreements of record and any tenants and/or persons in possession.”

    The last sentence of page 4 merely says that the Administrator merely has to return the deposit if it can not convey title. However, conveyance of title is not the same as conveyance of a clean chain of title. Only a title company can insure the purchaser against unexpected problems with title. Titles have been conveyed in the past and problems have arisen after the fact. That is what owner’s title insurance is for.

    As for the C of O, as I stated, there is no C of O, which you concur. My question is what effect that will have when a buyer renovates the property and creates a residential unit. Whenever the C of O changes or if a C of O is established (in this case), the property is re-assessed and the property taxes go up accordingly. I’ve seen this happen. Homes paying $10,000 per year in taxes have been re-assess after a change in C of O and the new level was over $30,000.

  • milton

    renovation of old houses is something that Brooklynites know about and to those who love the challenge it is not off-putting or scary. A gut renovation is in many ways easier than a partial renovation. Any older house one buys in need of updating will require attention and money.
    Also, it is not at all unusual that the building does not have a C of O. Most old houses do not. When the new buyer renovated the project and files his architects papers with the department of buildings the end result will be a c of a. A gem in the rough means it is rough. But the art of turning decrepit buildings into beautiful homes is a particularly Brooklyn-centric activity. This building will be easy to renovate and restore and to get a proper c of o for once the work is completed.

  • milton

    sorry about the ungrammatical posting but when I type
    the words are hidden by the vertical column of ads on
    the left and as a result I can’t read what I wrote.
    It must be a glitch in the website design?

  • GAO

    Thanks Milton. And as for title, this property has been in the Palmer
    family since god knows when. I don’t think title is an issue. None of those
    terms of sale that HeightsGuy cites has anything to do with the
    conveyance of marketable title. The real issue is the condition and
    that you are purchasing the property completely as is. We’ll see on
    Tuesday whether anybody is willing to take a chance on this little gem.

  • http://Robert HeightsGuy

    Thanks Milton and GAO for your thoughts about this. I am sensitive to issues of title because of the inherent risk associated with buying any property at auction.

    I agree that the key and major issue is the condition of the property. It would make sense for a buyer to have an engineer thoroughly inspect the property, which is normal procedure for the purchase of any house. However, it is impossible to have an engineer inspect 280 Hicks because the Administrator does not allow access to all parts of the house. As I noted, only a small corridor within the interior is accessable. They do not allow access to the roof, cellar, or rear of house (for inspection of the rear wall). If the key issue is in fact the condition of the house, then not having a professional opinion of such is a major impediment for a purchaser and this increases the risk. I agree that the property has great potential, but the real question is not just the condition of the property, but the pricing.

    To put it into market terms, if the risks are higher than normal, then the price should be lower than normal. This simple principle was illustrated at the last auction when the house did not attract any bidders for the-then minimum $2 million. Does the $200,000 reduction compensate for the risk inherent in purchasing this property? That is the big question for an interested buyer. If a full engineer’s report were available, then the risk could be quantified and a rational decision could be made. In the absence of such a report, it is all guess work — a guess that will cost a minimum of $1.8 million!

    As for Brooklynites being accustomed to renovating old homes, how about people who have never done so before? For the individual buyer, it is a daunting learn-as-you-go experience that is filled with risk and, of course, potential reward. Milton, although you state that a C of O can be obtained, the real issue is whether or not that would trigger an increase in the assessment for property tax purposes. As I mentioned before, a change in assessment could trigger a substantial increase in property taxes from the current $12,500 per year to over $30,000. The net present value of the approximate $20,000 yearly increase is substantial.

  • http://Robert HeightsGuy

    280 Hicks Street sold at auction today.

  • BrandonH

    Above comments about title are irrelevant because the Public Administrator guarantees to deliver insurable title. If they don’t, then the buyer gets his deposit back.

    The real issue with 280 Hicks was its physical condition. Many negative reports by commentators on various blogs obviously focused on the superficial. They saw a lot of clutter and there was water-damaged plaster on ceilings and walls on the 2nd floor. However, in my opinion, it is structurally sound. It has massive wood beams. The ones that were visible all appeared to be solid.

    This carriage house was obviously built to carry a lot of weight on the 2nd floor where hay bales and food would have been stored. Built to hold a lot of weight, it is an extremely solid structure, which is probably true of many carriage houses.

    Also worthy of note is the fact that the ceiling heights are impressive for a carriage house. I measured and found the first floor ceiling to be 11 1/2 feet and the 2nd floor ceiling to be 10 1/2 feet, both of which are comparable to townhouses in the area. The high ceilings give a feeling of volume to the spaces of this house.

    Finally I would note that there is a massive skylight in the 2nd story rear that was used as an artist’s studio. The famous abstract painter Esteban Vincente lived at 280 Hicks between 1942-1946. Standing in that room, I could easily imagine him painting and canvases covering the walls and floors. (see 1942-1946 in: http://tinyurl.com/2ug4rhg )

    I agree with Milton. This house is a gem. Someone with an eye for value ended up buying it at auction on Tuesday.

  • http://Robert HeightsGuy

    I realize this is an old thread, but I thought that I would mention that I happened to walk by 280 Hicks the other day. An antiques dealer was cleaning the place out, so I was able to get a peak inside. Without all the junk in it, the carriage house was impressive. True, it needs a complete renovation, but the volume of the space is amazing. The ceilings were very high and I had a feeling of spaciousness. Unlike townhouses that have center walls that create a hallway, this carriage house was wide open from party wall to party wall. That gave it a feeling of spaciousness. Previously, I expressed scepticism about the house, but seeing it without all the junk in it gave me reason to reconsider.