Manhattan Residential Market Cools

1) The slowdown in Manhattan apartment sales continued into the 3Q2016; the number of sales fell by 15.3% from the 3Q2015. The quarter’s sales total was the lowest third quarter since 2011, following the recession.

2) Sales of co-ops fell by 17.5% (source-NYC Department of Finance), reflecting in part a buyer preference shift to new condo product with amenities and locations Downtown.

3) Despite the pause in the market due to uncertainty imposed by the presidential race and general elections, good apartments that are well-priced are selling.

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Developers Find Sweet Relief in the $1 Million to $3 Million New Development Condo Market

 1) The residential market remains strong for new development condominium product priced between $1 million and $3 million.

2) In Manhattan, 54.7% of all new contracts signed during the third quarter fell into the middle market price segment, up from 51.4% for the first half of the year (source: Halstead New Development Marketing).

3) Although real estate developers had targeted the luxury market ($4 million+) over the past three years during the current cycle, the demand was strongest in the middle market; there has been a shift now of focus in new development to meet the demand in this segment of the market in all of the boroughs.

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High-End Condos for the Merely Affluent

 1) Although the luxury new development market ($4 million+) is experiencing a slowdown, the segment of the market known as “affordable luxury”, priced at $1 million-$3 million, catering to the entry-mid level “value” buyer, continues to see a lot of activity.

2) You are likely to find new development affordable luxury apartments in more of Manhattan’s emerging market neighborhoods including Hell’s Kitchen (Midtown West), Yorkville, Harlem, Hudson Square, East Village and the Lower East Side as well as many areas in both Brooklyn and Queens.

3) Buyers are attracted to new development product with high end finishes and amenities at the right price; they are also drawn to neighborhoods where they see a potential upside in value.

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Another Sign Manhattan Real Estate is Feeling the Pain

 1) Global economic turmoil, volatility in oil prices, and the uncertainty of this year’s presidential election are all impacting the luxury home buyer’s purchase decisions.

2) In New York City, where more than 3,500 new development apartments are slated to hit the market this year, developers have to work really hard to make a sale.

3) For the first 35 weeks of this year, contracts to buy Manhattan homes priced at $4 million or higher dropped 21% vs. the same period in 2015 (source: Olshan Realty).

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Park Avenue Pads Lose Panache

1) During the first 35 weeks of the year, there were 33 contracts signed on Park Avenue co-ops priced above $4 million, a nearly 27% drop from the 45 signed during the same period in 2015 (source: Olshan Realty).

2) “The decline mirrors the rest of the co-op market in Manhattan. Many of them need a lot of work and the younger audience has no interest in going through the co-op board process. They want newer infrastructure, freedom of ownership and more amenities found in new development condos, many in trendy neighborhoods” (Donna Olshan-President, Olshan Realty).

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Billionaires’ Row: 2014-2016

1) There are currently 272 units in the four Billionaires’ Row condo towers on the market: One57, 220 Central Park South, 252 East 57th Street and 432 Park Avenue; of those listings, 122 units or 45% are in contract. Asking prices average $22.7 million or $5,663/sf.

2) At the end of 2015, there were 7,370 people worldwide with a net worth of $500 million or more, according to research firm Wealth-X, up only slightly from 7,210 a year earlier.

3) Demi-billionaires are the main buyer group for luxury apartments priced at $30 million or more. For supply to be met, a large portion of them would have to purchase a NYC apartment.

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As Rental Supply Grows, Landlords Negotiate

1) Per brokerage firm, Citi Habitats, vacancy rates for Manhattan rental apartments have reached their highest level at 1.92% for any July in at least 14 years and landlord concessions more than doubled from July 2015.

2) So far this year, 15 new buildings containing a total of 2,552 apartments have opened in Manhattan and 10 buildings containing 1,979 units opened in Brooklyn (source: Nancy Packes-Marketing Consultant).

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How Lower Manhattan Became the Most Happening Neighborhood in NYC

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1) “Downtown has emerged as a model of what’s most dynamic about New York”, says Rob Vecsler, President of Residential Development for Silverstein Properties. “With the best restaurants, bars, shops and parks, it’s where people want to live, work and visit”.

2) In addition to more than 600 tech companies and a migration of major media and publishing firms to the area, including Conde’ Nast, Vox Media and Harper Collins, the major catalyst to the transformation of the neighborhood has been the arrival of Brookfield Place and Westfield World Trade Center, two new major retail centers (about 750,000 square feet in total with specialty shops and eateries).

3) The influx of new retail, private sector employment with 266,000 workers, and proximity to the Fulton Center (with 10 subway lines) and WTC Transportation Hub, has sparked a residential boom (the area’s population is approximately 60,000 people, almost triple pre-9/11).

4) New residential developments include: 30 Park Place, 111 Murray Street, River & Warren, 12 Warren, 50 West Street, The Beekman, 70 Pine Street, 180 Water Street, 100 Barclay (Ralph Walker Tower), 101 Wall Street, 1 Seaport Tower, The Woolworth Tower Residences, 45 Broad Street, 125 Greenwich Street, and 77 Greenwich Street.

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Queens’ Population, Real Estate Boom Makes it Look Like the Next Brooklyn


1) “In recent years, neighborhoods such as Woodside, Sunnyside and Astoria have been the chief beneficiaries of a large population boom, according to the U.S. Census Bureau data. In fact, Queens is second only to ultra-hip Brooklyn in terms of its influx of residents since 2010”.

2) “Queens is now in the process of becoming “Brooklynized” by young professionals, whose exodus from soaring rents and home prices has caused a wave of gentrification to crash along the borough’s shores”.

3) Buyers and renters will find more value in Woodside, Sunnyside, Astoria and Jackson Heights vs. Long Island City; all neighborhoods are along the 7 train line.

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Here’s What Real Estate Experts are Saying about Brexit

1) Howard Lorber (Douglas Elliman Chairman)-“New York City will move to the No. 1 global city in the world, a spot that London currently holds. In addition, because of Brexit, interest rates have dropped to 30-year lows, causing mortgages to also drop significantly, thus raising the value of both residential and commercial real estate.”

2) William Rudin (CEO-Rudin Management): “Our competitive advantages consistently make real estate here an attractive investment. As the economic uncertainty surrounding Brexit grows, investors worldwide will continue to turn to New York as a safe haven. However, our economy is inextricably linked to the global economy, and in the long run, we benefit more from global stability than instability.”

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