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Manhattan office condos lose their cool

The coronavirus has taken the shine off Manhattan office condos with sales dropping 66 percent to their lowest in more than a decade.

Just $80.93 million in sales were completed during the first half of 2020, according to Michael Rudder, founder of Rudder Property Group and one of the city’s leading experts on the sector.

Rudder Property Group’s biannual office condominium report for the first half of 2020 shows that average sales price per square foot decreased 6.8 percent to $826 psf, down from an average of $886 psf in the second half of 2019.

MICHAEL RUDDER

“Not surprisingly, COVID-19 halted sales through the first half of 2020 as businesses hold off on large capital expenditures to focus on staying afloat, though the fundamentals of owning your own space long-term remain strong,” said Rudder.

 “Companies in the market right now may suddenly find themselves with more options and lower prices, though it remains to be seen if that will translate in to a higher transaction volume during the second half of the year.”

The report includes a case study on how many landlords converted all—or part—of an office building to office condominiums.  The conversions allowed owners to sell the vacant space directly to owner/occupiers, giving them the ability to pay down their mortgage and retain ownership of the income producing, occupied portion of the building.

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