Marcus & Millichap: Multifamily Update
There continues to be a huge appetite for multifamily investment in Manhattan and the outer boroughs, says Marcus & Millichap investments professional Matt Fotis. Currently, Queens is continuing to grow, while Brooklyn has leveled off a bit. Even so, there are Brooklyn deals to write home about: Matt’s team just sold an eight-family Park Slope building for $7M, with a record price per SF: just south of $900/SF. The deal went to a Manhattan-based 1031 exchange. This is typical of a growing trend that speaks to the strength of growth opportunities in the outer boroughs: investor crossover, as they shop beyond their usual stomping grounds and comfort zone. Another example: Matt is negotiating a contract for a piece of land in downtown Manhattan that will probably trade for $150/buildable SF less than it would have sold for six months ago. Some of the most competitive offers they are receiving are coming from developers based outside of Manhattan who've never before developed there. Even in Queens, the team is selling buildings 50% of the time to Manhattan investors. Matt says there is still more product out there than ever before, especially free-market buildings/end-user properties. It’s not easy to understand where we are in the market: all the announced deals really took shape about four to six months ago; active brokers like Matt and his team are negotiating in the here and now, and have a better feel for the very current conditions. For more information on our Bisnow partner, click here.