NYC Nearly Twice as Expensive as NJ
If dinner tonight is another 25¢ packet of ramen in order to make rent at your Williamsburg walk-up, you might want to look across the Hudson, we learned at this morning’s Bisnow Northern NJ State of the Market event in Newark. (Ramen in NJ is cheaper and comes with gabagool and prosciutto.)
Multifamily rents are as much as a 40% lower than in NYC’s residential strongholds, and there's never been greater price discrepancy between urban areas and ring communities (think Downtown vs Hoboken), DSF Group prez Joshua Solomon told a crowd of 200 at the Newark Club.
We snapped Joshua, whose firm recently acquired a luxury rental building in Westchester's New Rochelle, which offers rents 30% below Manhattan. He says New York City’s prices are why his Boston-based company is finding value investing in outer areas like NJ.
Same goes for Boston-based Intercontinental Real Estate Corp, which is building 140 units at 900 Monroe in Hoboken in a JV with Bijou Properties. Director of acquisitions Michael Keyes says the only hard part about building residential is underwriting ground-floor retail. “You can’t have Whole Foods anchor every project.” (Then that was all a dream... thanks for clearing it up.) 900 Monroe’s retail space, luckily, is pre-leased to a daycare. “We’re going after the stroller crowd,” he says (proof that Park Slope doesn’t have a monopoly on Bugaboos).
When you have some multifamily buildings going for as much as $1M/unit in Manhattan, investors are going to look in the Sixth Borough, according to HFF senior managing director Jose Cruz. His team is involved in a Hoboken building sale and has given 40 tours. We’ll have more coverage of our event in tomorrow’s issue of Real Estate Bisnow NJ.