Exclusive | Why tiny NYC home is on sale for just $9M — after owner sunk $16M on it

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A six-story Upper East Side townhouse that cost its owner over $16 million to buy and renovate is now on the market for just under $9 million — a staggering $7 million loss.

The seller, who requested anonymity, bought 238 1/2 E. 83rd St. in January 2013 for $2.6 million and spent $13.6 million tricking out the place — adding levels and installing custom-made marble floors, mahogany panels, an elevator, central air and a sophisticated security system.

“He did it knowing full well he likely wouldn’t get [his money] out,” co-listing agent Brown Harris Stevens’ Maggie Peters said during a tour of the property. “It was like a vanity project.”

“Anybody who’s buying it is getting an incredible bang for their buck,” Peters said.

Two major factors are driving the discount: width and location.

At just 14 feet wide, the 4,400-square-foot house is narrower than the city average of 18 to 20 feet, according to co-listing broker Barbara Fox of BHS.

“It’s width sends most people running, but yet it doesn’t read like a narrow, dark townhouse,” Peters said. “It really doesn’t.”

It is also situated between Second and Third avenues, well removed from the tony enclaves west of Lexington Avenue. The block features a psychic, a copy store, an auto repair shop and small residential buildings.

Inside, the owner, who primarily resides in Connecticut, spent $13.6 million completely transforming the property, converting it from a two-family building into a single-family mega-home. The gut renovation added three stories, six distinct outdoor spaces and entirely new mechanical systems.

The house, Peters added, “is a bit of an anomaly on the block.”

The home has three to four bedrooms, five bathrooms and three powder rooms, with a separate ground-floor apartment with its own street entrance.

Upon entering the foyer at the stoop entry level, there is a distinctive patterned inlaid marble.

There is a huge eat-in kitchen with a wall of windows and a balcony overlooking a garden.

The highly customized house has some quirks. For one thing, there is no formal dining room.

And on the second level, it was originally configured “like a man cave,” Peters said. “There was no proper living room. So we had to rejigger it to make it practical.”

The other side of that floor has a copper-top bar with seating, a fireplace, a TV, a powder room and a terrace.

On three are two spacious bedrooms and two marble bathrooms, plus a laundry room.

The fourth level houses the double-height primary bedroom suite with a floor-to-ceiling cathedral window and a private balcony. It has a walk-in closet and a large bathroom with a soaking tub and walk-in stall shower.

On five, there is a fully equipped gym and balcony office with a built-in desk and storage overlooking the primary bedroom, plus a marble bath.

There are two large roof decks on six, one with a fully equipped kitchen and dining room, and one for sunbathing.

The owner outfitted the ground level under the stoop with a living-dining room, a kitchen and one bedroom and one bathroom.

In the finished basement, there is a wine storage unit with a floor that looks like cork, full-size laundry equipment and a dog-washing sink.