Friday, July 2, 2010

Fast Rude

OK...I know this is a topic that's been written about to death.  In the business pages, in the culture pages, blah, blah, blah.  But I need to add my voice to the ever-growing chorus singing about how much Starbuck's sucks.  (Heh heh...Starsucks.  I'm gonna use that.)

Remember when the person who made your coffee drink wore a clean green apron, freshly ground the beans, andtook their time making your drink?  You spent $4 on coffee, and felt a little ripped off, but - mmm - that first sip of warm foamy milk and dark coffee with a light char.  Delicious.

Now your drink is made on the 21st century equivalent of a manufacturing assembly line.  Some 4th grade drop out presses a button on a contrpation that seems to have sprung right out of the Jetson's kitchen and voila! your drink has been mass-produced.  The milk is burnt and thin, or lukewarm because it's been on the counter for a while.  The coffee is charred and unpleasant.  And it's slapped down on the counter while your name is bellowed.  An experience similar to the DMV.  Service with a snarl.

I wish Peet's (the best location is on Sunset, in West Hollywood) would come to New York. 

Anyway, I let the "barista" (what fancy words we're giving the button-pushers) try a second time (let her earn that health insurance!) and took my coffee.  Strolling home, I passed the building on our corner - which spent about 3 years redoing the lobby.  It's the home of Real Estate agent to the stars, Brian Lewis.  You may have seen him proseletyzing on LXNY or Open House NYC, with his smug grinning pieface.  (You can't miss him - he looks like that cartoon piano-playing moon, Mac Tonight, from a late 1980s McDonald's campaign.)

Ugh.  Brian's specialty is pricing homes well below market value simply to move them fast.  It hurts the owners, but he gets a reputation for pushing a lot of volume, so what does he care.  The economics of real estate brokerage is pretty simple.  The average commission is 6%, split between the exclusive listing broker (seller's initial broker) and the broker who brings the buyer to the property.  The seller pays that commission, and it is often negotiated down to 5%.  The brokers split it; then each splits the commission with their agency.

So, let's do the math.  If you list and sell a home for $1,250,000, the total commission is $62,500 (5% of $1.25mm).  Each broker takes $31,250, then splits it with their brokerage, and brings home $15,625.  If you reduce that price to $1,000,000, the total commission is $50,000.  It's split between the brokers, then split with their brokerages, and each broker takes home $12,500.

That deal just cost you $250,000.  It cost your broker $3,125.  And it may be the difference between selling your house in a week or two and selling your house in 3 months.  Assuming the difference is 10 weeks, the broker only earns $312.50 per week (about $60 per day) if he lists it at the higher price.  His incentives and yours are not aligned.

Anyway - math lesson aside - the point is that pieface makes his coin underselling your home.  Meanwhile, he's on the co-op board of his, and to improve it's value, they undertook a very lengthy and expensive renovation which appears to have done nothing more than refurbish the lobby.

Oh, and they renamed the building. 

The Del Monte.

Why would you name a building after canned vegetables?  I guess it's ok if your main occupant is a canned ham.  (Or canned fruit.)

1 comment:

  1. OK, I'm finally back to updating my blog. Your turn!! ;)