| Excessive demand and a low supply of buildings for sale has caused values to rise sharply and cap rates to fall 75 to 100 bps in the past two months, we learned at Massey Knakal’s Q1 breakfast in its Madison Avenue offices yesterday. Here's chairman Bob Knakal with the firm’s Michael DeCheser, Brendan Gotch, Garrett Thelander, and James Nelson (the only one brave enough to go without a jacket... fortune favors the bold, James). Investors sniffing around include families, high-net-worth individuals, institutional capital, foreigners, and first-time New York buyers—but there are hardly any buildings for them, since potential sellers don’t know what they’ll do with the money once their assets sell. Overall, Q1 performed at modest levels, on par with Q4 ‘11: “It was disappointingly not better,” Bob says. What’s encouraging: the average price of buildings sold was $12.6M, even higher than the peak (and in ‘09, $4.3M). |
Massey Knakal’s borough gurus of (clockwise, from top) Jeffrey Shalom, Tom Donovan, Karl Brumback, and Rob Shapiro swear they didn’t organize this photo by suit and shirt color (we're on a fashion kick today), although multifamily strength coordinated nicely in all the submarkets. The best performing submarket outside of Manhattan (which saw 191 buildings sell for $5.7B) was Northern Manhattan, but Brooklyn won for best in recovery. (Sounds like the Westminster Submarket Show.) The breakdown:
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WHEREFORE ART THOU BUILDINGS?
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Brendan Gotch, Garrett Thelander, James Nelson, Jeffrey Shalom, Karl Brumback, Michael DeCheser, Northern Manhattan, Rob Shapiro, Tom Donovan
