Second Half 2017 NYC Investment Sales Report

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EXECUTIVE SUMMARY 

Key Findings

Citywide Investment Sales activity retreated in the second half of 2017. The total consideration, or total monetary value for all recorded sales, was $17 billion citywide, a 37 percent decline compared to the second half of 2016. The total number of transactions was 2,334, a 19 percent drop compared to the second half of 2016. The total consideration for the investment sales market in each borough decreased except for the Bronx.

Manhattan investment property trading continued to outpace the other boroughs in the second half of 2017, accounting for 60 percent of total citywide consideration.

The five largest investment sales transactions (by sale price) in the second half of 2017 were in Manhattan:

  • $580 million ground lease of 375 Hudson Street, a 19-story office building
  • $520 million Office building at 1440 Broadway
  • $468 million Office building at 685 Third Avenue
  • $416 million Rental apartment building at 180 Water Street
  • $339 million Office buildings at 245 and 249 West 17th Street

 

Sales Activity by Borough

Manhattan investment sales consideration decreased 40 percent to $10.1 billion in the second half of 2017 from $17.0 billion in the second half of 2016.  Transactions decreased 26 percent to 452 year-over-year. Since REBNY published its first Investment Sales Report in the second half of 2015, sales activity data has shown growth of sales in properties outside of Manhattan. The share of dollars spent in Manhattan peaked in the second half of 2014 at 74 percent and it has gradually declined in each half year since then to represent 60 percent of citywide consideration to-date. Offices and Multifamily Rental Elevator properties sold in Manhattan accounted for 85 percent of the total citywide Office consideration and 73 percent of the total citywide Multifamily Rental Elevator consideration. The average price per square foot of office properties sold in Manhattan declined 12 percent to $823 from $930, while the median price per square foot increased two percent to $990 from $970 year-over-year.

The Bronx was the only borough that recorded greater investment sales consideration in the second half of 2017 than in the second half of 2016. Investors spent $1.5 billion in the Bronx in the second half of 2017 compared to $1.4 billion in the second half of 2016. Transactions declined by four percent to 375 since the second half of 2016. Sales of the Concourse office building at 260 East 161st Street for $115 million and the Frances Schervier Home and Hospital at 720 West 231st Street for $86 million propelled the rise in total consideration in the Bronx.  

Brooklyn total sales consideration in the second half of 2017 declined 27 percent to $3.2 billion from $4.4 billion in the second half of 2016. Total transactions decreased 18 percent to 783 in the second half of 2017 from 954 in the second half of 2016. The top sales in Brooklyn (by sale price) were: the Leverich Towers Hotel Dormitory at 79 Willow Street for $203 million, the office building at 16 Court Street for $171 million, and the dormitory at 90 Sands Street for $135 million. All three properties are located in Brooklyn Heights. The value of Brooklyn investment sales transactions accounted for 19 percent of the total citywide consideration.

Queens investment sales declined since the second half of 2016. Total consideration was $1.9 billion this half of the year, which was 46 percent less than the second half of 2016.  There were 18 percent fewer transactions in the second half of 2017, 534 investment sales, compared to 649 in the second half of 2016. Two properties sold for over $100 million in Queens in the second half of 2017 compared to six in the second half of 2016: the multifamily rental apartment complex at 7-11 Seagirt Avenue in Far Rockaway, which traded at $135 million, and the Assi Plaza supermarket in Flushing at 131 39th Avenue, which was sold for $115 million. The sale of the vacant site at 31-07 20th Avenue in Astoria was recorded as $94 million.

Staten Island investment sales also decreased in the second half of 2017. Total consideration was $203 million, down 59 percent from the second half of 2016. The number of transactions completed in the borough declined 30 percent to 190 compared to 273 in the second half of 2016. There were no transactions for Staten Island multifamily rental buildings recorded in this half of the year compared to the two buildings sold in the second half of 2016. None of the Staten Island investment sales traded for over $100 million in the second half of 2017 compared to one in the second half of 2016. The highest value sales in Staten Island in the second half of 2017 were $11.7 million and $8.3 million for two neighboring Travis-Chelsea hotels at 290 and 310 Wild Avenue. The third-largest sale by sale price was the former prison at 2911 Arthur Kill Road for $7.2 million.

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