Widespread Concessions Aren't Saving New York's Rental Market

41-41 44th St. in Sunnyside, one of six buildings acquired from Ares by A&E Real Estate
Photo credit: Google Maps

Concessions are increasingly becoming the norm in apartments all over New York City, but it is not doing much to stem the tide of the softening market.

Manhattan's median rent in April was $3,309 when factoring in concessions, a 1.8% drop from April 2016 and the biggest in the past 12 months. Meanwhile, concessions were part of 29% of rental agreements over the same time frame, doubling the rate from last April, according to a Douglas Elliman report obtained by The Real Deal.

The impact is being felt more by higher-value assets, another troubling sign. Doorman buildings in Manhattan, which make up about 50% of the multifamily market, had a 3% drop in median rent, the biggest decrease in five years.

In other boroughs, the story is similar. Brooklyn rents stayed flat from last year, but concessions also doubled in the borough to 15%. Northwest Queens apartments are giving away concessions in 45% of leases, and though rent increased 10% over the same time period, Miller Samuel CEO Jonathan Miller, who conducted the study, believes the increase has more to do with new deliveries than an increase in overall value.

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