The Beginning of the End?

Posted by: Silverwood Pianos

The Beginning of the End? - 11/16/12 08:46 AM




Steinway Hall Sold
Posted by: Zeno Wood

Re: The Beginning of the End? - 11/16/12 09:12 AM

Holy cow!

On the other hand, they had sold it before, and bought it again about 15 years ago. Maybe they'll just rent it, as before, and the money held in escrow is akin to a deposit.
Posted by: Grotriman

Re: The Beginning of the End? - 11/16/12 09:37 AM

Do you really think they can sell enough pianos at that location to pay the rent? Evidently they're holding a mortgage for over $100 million. This means a monthly payment of over $100,000.00 for the mortgage at least. Add in the overhead of the half dozen people, heat, A/C, electric and tuning - and you are talking about another $150K per month. You'd have to sell a lot of pianos out of this location to justify that kind of expense. Assuming a 50% margin you are talking about more than $500,000 worth of pianos (40?) per month just to break even.
Posted by: Silverwood Pianos

Re: The Beginning of the End? - 11/16/12 10:40 AM

When Samick Corp. purchased an interest in Steinway some years back it was my understanding this gave Steinway Corp about 50 million in cash that was used to pay down debt.

A company that uses a capital injection for capital expenditures such as new equipment or upgrades to infrastructure is a good thing.
A company that uses capital to stay afloat is not an indication of longevity.
Posted by: beethoven986

Re: The Beginning of the End? - 11/16/12 05:10 PM

I certainly hope not. Steinway definitely isn't my cup of tea most of the time, but the loss of such an iconic American brand would just be a huge embarrassment for this country.
Posted by: Emmery

Re: The Beginning of the End? - 11/16/12 05:24 PM

Es gibt immer Hamburg Steinway.
Posted by: Silverwood Pianos

Re: The Beginning of the End? - 11/16/12 07:59 PM

Originally Posted By: Emmery
Es gibt immer Hamburg Steinway.



Es ist in der Tat.
Posted by: Supply

Re: The Beginning of the End? - 11/16/12 08:16 PM

Steinway is Steinway. NY and Hamburg are part of the same enterprise.
Posted by: victor kam

Re: The Beginning of the End? - 11/16/12 10:43 PM

Does that mean Steinway will have to relocate?
Posted by: malkin

Re: The Beginning of the End? - 11/17/12 09:46 AM

Originally Posted By: Grotriman
Do you really think they can sell enough pianos at that location to pay the rent? ...


Maybe they will start selling pianos on Amazon.
wink
Posted by: Jerry Groot RPT

Re: The Beginning of the End? - 11/17/12 09:51 AM

Maybe they will turn around and just lease the place instead? Might be less expensive for them? Or, lease a smaller portion of it.
Posted by: pianolive

Re: The Beginning of the End? - 11/17/12 10:42 AM

In the CBS era many properties were sold to get cash.
Bechstein did the same in Berlin. Sold the original factory area to the town of Berlin.
Of course, it might be a sign of cqash flow problems.
Posted by: ando

Re: The Beginning of the End? - 11/17/12 11:28 AM

Originally Posted By: Jerry Groot RPT
Maybe they will turn around and just lease the place instead? Might be less expensive for them? Or, lease a smaller portion of it.


I don't understand why it would be so expensive to operate in a building you already own. Why would it be any cheaper to lease it? Maybe it's different in NY, but in Australia if you already own a building, you aren't up for too many more expenses and in the long run it can be very beneficial to have a stable location you can't be evicted from. Forced relocation can be very expensive. Do you have some kind of heavy land/building tax in NY or something?
Posted by: Jerry Groot RPT

Re: The Beginning of the End? - 11/17/12 12:03 PM

I don't know. Just a thought. Less expenses pertaining to upkeep maybe?
Posted by: Ralph

Re: The Beginning of the End? - 11/17/12 12:11 PM

It's my understanding that the Steinway family used to live there as their primary residence in addition to using it as a showroom. It really is disapointing to hear that landmark will no longer be part of Steinway.
Posted by: rysowers

Re: The Beginning of the End? - 11/17/12 01:04 PM

Zeno is right - this has happened before. It's a lot of money to have tied up in a retail location that competes with the company's dealers.

I think if there is a REAL beginning of the end, its when they added Billy Joel to the room where some of the immortal pianists are displayed. Mozart, Chopin, Liszt, Rachmaninoff, and...Billy Joel!
Posted by: Jerry Groot RPT

Re: The Beginning of the End? - 11/17/12 01:07 PM

http://www.pianoworld.com/forum/ubbthreads.php/topics/1987813/1.html

Go on page one to see what Bob Snyder has to say about it.
Posted by: pianoloverus

Re: The Beginning of the End? - 11/17/12 02:09 PM

Originally Posted By: Ralph
It's my understanding that the Steinway family used to live there as their primary residence in addition to using it as a showroom.
Not correct to my knowledge.
Posted by: Supply

Re: The Beginning of the End? - 11/17/12 05:53 PM

In the other tread, one expert noted:
Quote:
My guess is the the realestate value of Steinway Hall exceeded the advantages Steinway could realize staying in that location.
I can imagine this to be true. And, it may also hold true for the Steinway factory property in Astoria at some point. I have been told that the real $ value of the factory lies in the land.

Quite a few years ago Bösendorfer moved production out of downtown Vienna to a sleepy town almost an hour's drive away, and retained a much smaller downtown location where the final voicing etc was done. This made a lot of economic sense, no doubt, and they could still profess to be based in the capital city. Bechstein did the exact same, benefiting from huge federal incentives to move production into a far eastern backwater near the Polish border, while maintaining a prestigious address in Berlin. Maybe S&S will eventually do the same?
Posted by: David Jenson

Re: The Beginning of the End? - 11/17/12 06:37 PM

Originally Posted By: rysowers
I think if there is a REAL beginning of the end, its when they added Billy Joel to the room where some of the immortal pianists are displayed. Mozart, Chopin, Liszt, Rachmaninoff, and...Billy Joel!
Well, he IS "The Piano Man". 'Right? laugh
Posted by: Bob

Re: The Beginning of the End? - 11/17/12 10:33 PM

Nope, the beginning to the end was Billy Joel's use of a digital piano last time I saw him... frown

I believe the Steinway family lived in a house near the factory, which still stands, occupied by regular folks!