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Deals & Dealmakers

Multifamily transaction volume stable in July, dollar volume dips

New York City multifamily transaction volume remained stable in July, but dollar volume dipped year-over-year as institutional and portfolio sales took a back seat to smaller deals, according to Ariel Property Advisors’ Multifamily Month in Review for July.

In July, New York City saw 62 transactions comprised of 81 buildings totaling $601 million in gross consideration. This represents a 3 percent decrease in transaction volume, a 35 percent decrease in building volume and a 43 percent decrease in dollar volume compared to July 2013, which saw 64 transactions comprised of 125 buildings totaling $1.058 billion in gross consideration.

Shimon Shkury
Shimon Shkury

Dollar volume in July was virtually unchanged compared to June, while transaction and building volume declined by 14 percent and 27 percent, respectively, from the previous month.
“With the exception of Northern Manhattan there were fewer institutional and portfolio sales citywide in July, which resulted in a year-over-year decline in dollar volume,” said Shimon Shkury, president of Ariel Property Advisors. “Because multifamily pricing remained strong across all submarkets, the report indicates that the decline was due to a lack of available supply rather than a lack of demand.”

The following is a breakdown of the July 2014 volume by submarket:

•Manhattan. Although dollar volume declined 70 percent to $178.9 million in July 2014 compared to July 2013, Manhattan had the highest dollar volume in the city with 12 buildings sold across 11 transactions. A Turtle Bay mixed-use building comprised of 43 residential units and 7 commercial units sold for just over $40 million, which translates to $804 per square foot.

•Northern Manhattan. Northern Manhattan was the lone exception to the city’s overall trend of experiencing fewer portfolio sales, as 24 buildings traded across 11 transactions totaling $148.638 million in gross consideration. A package of two southern Harlem buildings located at 2053 Frederick Douglass Boulevard and 300 West 112th Street helped anchor the region’s strong month, selling for $30 million, or $465 per square foot. In addition to the 55,000 square feet of existing space, the deal also included roughly 30,000 square feet of additional development rights.

•The Bronx. Volume in the Bronx remained relatively stable with 25 buildings trading across 22 transactions totaling $143.401 million. A 72,000-square-foot, mixed-use building at 2141 Holland Avenue in Morris Park sold for $16.5 million, which translates to $229 per square foot.

•Brooklyn. Brooklyn posted declines from the previous month with 13 transactions covering 15 buildings totaling $90.868 million in gross consideration. A 112-unit elevatored building located in Sheepshead Bay sold for $20 million, which equates to $189 per square foot.

•Queens. Queens had a light month, with five buildings trading across five transactions totaling $39.320 million in gross consideration. A large percentage of the borough’s dollar volume came from the sale of a 103-unit building located in Elmhurst, which traded for $21 million, or roughly $236 per square foot. Another notable sale took place in Astoria where 24-16 29 Street, a 27 unit building, sold for $7.25 million, or $290 per square foot.

For the six months ended in July 2014 the average monthly transaction volume remained steady at 62 transactions per month and average dollar volume of $806,052,207.
The multifamily transactions included in the analysis occurred at a minimum sales price of $1 million, with a minimum gross area of 5,000 square feet, and with a minimum of 10 units.

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