Northern Manhattan’s Breakout Year
A new report from Ariel Property Advisors gives credence to what many observed last year as a red hot Northern Manhattan commercial real estate market, showing that multifamily pricing hit its strongest level since the 2007 boom.
The data shows that the number of properties sold in 2013 increased by 44 percent over the previous year, from 310 to 534 properties, with total dollar volume jumping more than 80 percent, from nearly $1.2 billion to $2.12 billion.
The multifamily sector accounted for 47 percent of the property transactions and 77 percent of the dollar volume.
“Much of the multifamily activity was the result of large portfolio transactions as institutional sellers were incentivized by strong pricing and the prospect of achieving well above their projected returns in shorter than anticipated time-frames,” said Victor Sozio, vice president of Ariel Property Advisors, in a statement.
The data also backs strength in development, with the dollar value of the year’s 43 development deals jumping 91 percent to $227 million, with the average price per buildable square foot (for vacant land) of $119 surpassing the $115 average seen in 2007.
“Strong rents, scarce new condo product, more neighborhood amenities, and the prospect of achieving higher yield lent tremendous momentum to Northern Manhattan development site sales,” said Michael Tortorici, vice president of Ariel Property Advisors, in a statement. “Increased confidence from developers, coupled with increased liquidity from lenders, also led developers to broaden their search parameters to areas such as East Harlem, Washington Heights, and Inwood.”
The Northern Manhattan 2013 Year-End Sales Report tracks development, multifamily, industrial, and other commercial property sales over $850,000 north of East 96th Street and north of West 110th Street.