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Report: Manhattan multifamily market in flux

The Manhattan multifamily market saw a significant increase of 47.7 percent in total dollar volume and a modest decrease of 0.6 percent in total building volume during the first half of 2018 compared to the first half of 2017 according to a first-time Manhattan multifamily market report by Cignature Realty Associates.

There were some other bright spots: The average total sale price for elevator buildings and price per square foot for walk-up buildings in Manhattan increased compared to the first half of 2017.

LAZER STERNHELL

“Overall, the Manhattan multifamily market continues to be lackluster, primarily because the forces of a healthy real estate market are not aligned,” said Cignature Realty’s CEO Lazer Sternhell.

“Rising interest rates and low cap rates are enticing buyers to wait for better deals. In addition, government regulation including higher taxes and fees, as well as increased and stricter regulations are all contributing to the multifamily market slowdown.”

Cignature Realty’s “Manhattan Multifamily Insight” for Mid-Year 2018 is the first in a series of monthly and quarterly reports — designed to give building owners, buyers and sellers specific market knowledge on closed sales in Manhattan and its major submarkets: Northern Manhattan, Upper West Side, Upper East Side, Midtown and Downtown.

“We wanted to create a series for reports that are focused exclusively on Manhattan’s multifamily market,” said Peter Vanderpool, president of Cignature Realty.

“For our clients who invest in multifamily apartment buildings, our data can help guide them when they need to make important decisions in today’s market.”

PETER VANDERPOOL

The Mid-Year 2018 report gives a detailed snapshot of Manhattan multifamily sales for the first half of 2018 in total dollar/building volume and average total sale price per building, per unit and per square foot.

This report also compares the data with the first half of 2017 as well as a breakdown by submarkets: Northern Manhattan, Upper West Side, Upper East Side, Midtown and Downtown.

Some highlights of the report reveal:

•Mid-year 2018 total dollar volume – $2.3 billion – represents a 47.7 percent increase as compared to mid-year 2017.

•Mid-year 2018 building volume – 178 buildings sold – was a 0.6 percent decrease as compared to mid-year 2017.Mid-year 2018 average total sale price per building for walk-up buildings is $8.1 million, an 8.7 percent decrease as compared to mid-year 2017; and for elevator buildings, is $32.8 million, a 28.4 percent increase over mid-year 2017.

•Mid-year 2018 average total sale price per unit for walk-up buildings is $748,516, a 9.4 percent decrease as compared to mid-year 2017 and for elevator buildings $868,900, a 4.7 percent decrease over mid-year 2017.

•Mid-year 2018 average total sale price per square foot for walk-up buildings is $1,128, a 1.8 percent increase over mid-year 2017 and for elevator buildings, $768 or a 13.8 percent decrease.

Submarket breakdown comparing mid-year 2018 with mid-year 2017:

Northern: 100.7 percent increase in dollar volume; a 10.0 percent decrease in building volume and 27.6 percent increase in unit volume.

Upper West Side: 89.2 percent increase in dollar volume; no change in building volume and a 63.2 percent increase in unit volume.

Upper East Side: 5.5 percent increase in dollar volume; a 4.8 percent decrease in building volume and a 12.9 percent decrease in unit volume.

Midtown: 18.4 percent decrease in dollar volume; a 19.0 percent decrease in building volume and a 1.9 percent decrease in unit volume.

Downtown: 56.5 percent increase in dollar volume; a 48.3 percent increase in building volume and a 47.8 percent increase in unit volume.

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