The New York City multifamily market in July continued to bounce back from notable softness earlier in the year, sustaining the positive momentum that took hold during the second quarter. While July’s performance slipped on a month-over-month and year-over-year basis, the market was coming off the two strongest months of the year in May and June.

In July, NYC had 39 multifamily transactions comprising 69 buildings totaling $631M, substantially outperforming the first four months of 2017. Dollar and transaction volume jumped 40% and 15%, respectively, from the first four month’s average of $452M from 34 transactions.

On a month-over-month basis, July’s numbers represent declines of 15% in transaction volume, 33% in building volume and 18% in dollar volume. Manhattan led the city in dollar volume and the Bronx registered across-the-board increases during the month. Brooklyn saw broad weakness, while Queens and Northern Manhattan recorded light activity.

Prices held steady in all submarkets in July with the exception of Brooklyn, which had an 8% increase in price per SF and a 5% increase in price per unit. Also noteworthy were Manhattan cap rates, which compressed for a third straight month, and stood at an average of 3.51% in July.

We partnered with Ariel Property Advisors to present a breakdown of July’s multifamily figures by submarket, with details on the most notable deals of the month.

Manhattan

Manhattan experienced its best month of the year in July, registering $280M across 11 transactions, three of which were above $50M. Year-over-year, dollar volume and transaction volume declined 19% and 8%, respectively.

The largest transaction of the month took place on the Lower East Side, where a 78-unit elevator building at 331 East Houston St. sold for $61.5M, at $788K/unit and $910/SF.

Northern Manhattan

Northern Manhattan experienced light sales volume in July, with just five transactions consisting of six buildings. These properties helped push dollar volume to $91M, the submarket’s second-highest total of the year, despite a month-over-month decrease of 29%.

The largest sale of the month in Northern Manhattan took place in Washington Heights, where Sugar Hill Capital Partners purchased a 95-unit elevator building at 200 Haven Ave. for $41M, or $329/SF.

Brooklyn

Brooklyn struggled in July, recording steep month-over-month declines. The borough saw just half the dollar volume and one-third fewer transactions compared to June. For the month, Brooklyn had 10 transactions consisting of 13 buildings, selling for $106M together.

Notable sales included Madison Realty Capital’s $35M acquisition of a 62-unit, new construction elevator building at 97 Grand Ave. in Clinton Hill, and DH Property Holdings’ $27M acquisition of a 146-unit three-property portfolio, translating to $215/SF and $185K/unit.

The Bronx

The Bronx fared well in July and was the only submarket to see a month-over-month improvement in all volume metrics. July was the submarket’s second-highest month in terms of dollar volume. For the month, the borough had 12 transactions comprising 34 buildings and $144M, representing a month-over-month leap of 100% and 15% for transaction and dollar volume, respectively.

Year-over-year, dollar volume in The Bronx jumped 27% in July, making it the only submarket to register gains compared to the same month last year. An eight-building portfolio with a mix of walk-up and elevator buildings was the largest transaction of the month. Paradise Management sold the 232-unit package for $34.7M, representing $158/SF and nearly $150K/unit.

Queens

Queens activity stalled in July, with only one transaction taking place. That sale was the two-building portfolio at 43-35 and 43-39 42nd St. in Sunnyside that traded hands for $9M or $382/SF.

To download Ariel Property Advisors’ full research report, click here.