MULTIFAMILY MONTH IN REVIEW: NEW YORK CITY | FEBRUARY … · JAN 2016 JAN 2016 % CHANGE VS. FEB...
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212.544.9500 I arielpa.nyc 122 East 42 nd Street, Suite 1015, New York NY 10168 MULTIFAMILY MONTH IN REVIEW: NEW YORK CITY | FEBRUARY 2016 Released April 2016 | By Ariel Property Advisors Join Our Network: e-mail [email protected] or visit arielpa.nyc
Transcript of MULTIFAMILY MONTH IN REVIEW: NEW YORK CITY | FEBRUARY … · JAN 2016 JAN 2016 % CHANGE VS. FEB...
212.544.9500 I arielpa.nyc122 East 42nd Street, Suite 1015, New York NY 10168
MULTIFAMILY MONTH IN REVIEW:NEW YORK CITY | FEBRUARY 2016
Released April 2016 | By Ariel Property Advisors
Join Our Network:
e-mail [email protected] or visit arielpa.nyc
Ariel Property Advisors | 122 East 42nd Street, Suite 1015 - New York NY 10168 | 212.544.9500 | arielpa.nyc | 2
ABOUT THE REPORT | CONTENT
Ariel Property Advisors is pleased to present its Multifamily Month In Review: New York City.
The report provides a monthly overview of market activity, benchmark transactions, revenue
and expense trends, and current events that affect the multifamily real estate market.
The Multifamily Month In Review is distributed to our clients on a monthly basis. Past versions
of the Multifamily Month In Review can be found at arielpa.nyc/investor-relations/research-
reports
TABLE OF CONTENTS
Multifamily Month In Review: New York City 3Multifamily Market Performance by Sub-Market 4Transaction & Dollar Volume By QuarterTrailing 6-Month Moving Average 5Pricing Indicators & Distributions 6About Ariel Property Advisors 7
SALES TEAM:
Shimon Shkury212.544.9500 ext. 11
Victor Sozio212.544.9500 ext. [email protected]
Michael A. Tortorici212.544.9500 ext. 13
ANALYST TEAM:
Daniel Novick212.544.9500 ext. [email protected]
Samuel Stuart212.544.9500 ext. [email protected]
COMPILED BY:
Multifamily Month In Review | New York City
3 | Ariel Property Advisors | 122 East 42nd Street, Suite 1015 - New York NY 10168 | 212.544.9500 | arielpa.nyc
LEGEND:
Manhattan is defined as below 96th Street on the east side and below 110th Street on the west side
METRICSFEB
2016% CHANGE
VS. JAN 2016JAN
2016% CHANGE VS. FEB 2015
FEB 2015
Transaction Vol 47 -20% 59 -31% 68
Building Vol 73 -4% 76 -43% 129
Dollar Vol $862,692,567 -37% $1,371,309,190 -33% $1,285,762,140
Total Units 2,707 -31% 3,904 -31% 3,908
ManhattanNorthern Manhattan
The BronxBrooklyn
Queens
DOLLAR VOLUME COMPARISON
BY LOCATION CHART
BUILDING VOLUME COMPARISON
BY LOCATION CHART
ManhattanNorthern ManhattanThe BronxBrooklynQueens
ManhattanNorthern ManhattanThe BronxBrooklynQueens
38+16+16+19+11+x16+19+23+26+16+x
38%16%16%19%11%
16%19%23%26%16%
New
Yo
rk C
ityMULTIFAMILY MONTH IN REVIEW: NEW YORK CITY | FEBRUARY 2016
New York City multifamily figures experienced decreases across the board in February after a strong start to the year in January. Pricing remains strong throughout the city as the sector looks to close out a strong first quarter.
For the month, New York City saw 47 transactions comprised of 73 buildings totaling $862.692 million in gross consideration. This represents a 31% decrease in transaction volume, a 43% decrease in building volume and a 33% decrease in dollar volume com-pared to February 2015, which saw 68 transactions comprised of 129 buildings totaling $1.285 billion in gross consideration.
Manhattan had a particularly light February seeing only 5 multifamily transactions con-sisting of 12 buildings for $329.625 million in gross consideration. The month’s largest transaction took place at 229-33 7th Avenue in Chelsea, where a 214-unit elevatored building traded for $211.250 million, or $1,006 per square foot. The buyer, Greystar, plans to boost the property’s rent roll by renovating kitchens, floors and common areas. Al-though transactions were light in February, 3 out of 5 traded for over $1,000 per square foot as multifamily buildings continue to demand strong prices in core Manhattan.
Brooklyn was the city’s most transactional submarket as the borough saw 19 buildings trade across 17 transactions, though gross dollar volume came in at only $159.849 mil-lion since 12 of those deals were under $10 million. A private investor affiliated with Forest City Ratner purchased Williamsburg Social, a 72-unit new construction building located at 250 Bedford Avenue. The property traded hands for $55 million, or $1,250 per square foot, and was last purchased in 2013 as part of a larger portfolio. In Crown Heights, a 51,000 square foot elevatored building located at 15 Crown Street, sold for $20.75 mil-lion, or $407 per square foot.
Northern Manhattan continued its strong start to the year as the area saw strong year-over-year dollar volume gains for the second month in a row. The Jewish Theological Seminary continued to sell off several of its Morningside Heights assets as a group of investors led by Coltown Properties purchased 3060 Broadway for $35.25 million, which equates to $733 per square foot. In East Harlem, the mixed-use walk-up building con-taining famous Italian eatery Rao’s and the adjacent single family home sold for $10 mil-lion, or $521 per square foot.
Despite 38% fewer transactions and the same number of buildings trading hands com-pared to February 2015, Bronx dollar volume spiked 213% year-over-year, representing the borough’s continued strength in the multifamily sector. The largest transaction took place in the South Bronx neighborhood of Soundview, where the Academy Gardens port-folio traded hands for just shy of $67 million, or $177 per square foot. The portfolio, which is encumbered by the Section 8 housing program, last sold in 2005 for $17.3 million.
Queens experienced 8 transactions consisting of 11 buildings totaling $96.45 million in gross consideration. Benedict Realty Group accounted for the month’s two largest trans-actions - $28 million and $25.5 million, respectively. Both properties are located in Kew Garden Hills and contain a total of 236 units between the two.
For the six months ended in February 2016 (Page 5), the average monthly transaction vol-ume remained steady at 56 transactions per month. The average monthly dollar volume increased slightly to $1.975 billion.
FEBRUARY 2016 SNAPSHOT
Dollar Volume
TransactionVolume
Building Volume
$863million
47 7333% decreasecompared to
February 2015
31% decreasecompared to
February 2015
43% decreasecompared to
February 2015
Ariel Property Advisors | 122 East 42nd Street, Suite 1015 - New York NY 10168 | 212.544.9500 | arielpa.nyc | 4
LEGEND
DOLLAR VOLUME COMPARISON GRAPH
BUILDING VOLUME COMPARISON GRAPH
MULTIFAMILY MARKET PERFORMANCE BY SUB-MARKET
METRICSFEB
2016% CHANGE
VS. JAN 2016JAN
2016% CHANGE
VS. FEB 2015FEB
2015
Transaction Vol 5 -58% 12 -58% 12
Building Vol 12 -8% 13 -57% 28
Dollar Vol $329,625,000 -39% $541,816,690 -48% $632,068,770
Total Units 452 -39% 738 -61% 1,172
Transaction Vol 9 -10% 10 -10% 10
Building Vol 14 0% 14 27% 11
Dollar Vol $140,800,900 -52% $290,700,000 94% $72,575,000
Total Units 389 -72% 1,369 43% 272
Transaction Vol 8 -50% 16 -38% 13
Building Vol 17 -35% 26 0% 17
Dollar Vol $135,966,816 12% $121,112,500 213% $43,434,991
Total Units 938 14% 820 154% 370
Transaction Vol 17 31% 13 -26% 23
Building Vol 19 27% 15 -62% 50
Dollar Vol $159,849,851 -29% $225,380,000 -60% $395,103,686
Total Units 422 -10% 470 -69% 1,341
Transaction Vol 8 0% 8 -20% 10
Building Vol 11 38% 8 -52% 23
Dollar Vol $96,450,000 -50% $192,300,000 -32% $142,579,693
Total Units 506 0% 507 -33% 753
Man
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ynQ
uee
ns
50
45
40
35
30
25
20
15
10
5
0
$500m
$450m
$400m
$350m
$300m
$250m
$200m
$150m
$100m
$50m
$0Feb’16 Jan ‘16 Feb‘15
Manhattan
Northern Manhattan
The Bronx
Brooklyn
Queens
Feb’16 Jan ‘16 Feb‘15
$632m
Multifamily Month In Review | New York City
5 | Ariel Property Advisors | 122 East 42nd Street, Suite 1015 - New York NY 10168 | 212.544.9500 | arielpa.nyc
TRANSACTION & DOLLAR VOLUME BY QUARTER | TRAILING 6-MONTH MOVING AVERAGE
$2.05b 85
$1.90b 80
$1.75b 75
$1.60b 70
$1.45b 65
$1.30b 60
$1.15b 55
$1b 50
$850mm 45
$600mm 40
$450mm 35
$300mm 30
THE TRAILING 6-MONTH MOVING AVERAGE
LEGEND: Transaction Volume | Dollar Volume
6 MONTHSENDED
AVG.DOLLAR VOL.
AVG.TRANSACTION VOL.
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
2015 Feb $1,357,954,941 68
Mar $1,333,980,966 70
Apr $1,200,676,182 70
May $1,290,527,333 73
Jun $1,181,037,917 74
Jul $1,242,256,498 75
Aug $1,169,263,522 72
Sep $1,139,226,877 67
Oct $1,116,979,972 64
Nov $1,010,023,697 61
Dec $1,941,213,881 58
Jan $1,972,591,490 56
2016 Feb $1,975,072,870 56
$6.5b 110
$2b 90
$1.5b 70
$1b 50
$500mm 30
MULTIFAMILY TRANSACTION TIMELINE
LEGEND: Transaction Volume | Dollar Volume
Q4 2014 Q1 2015 Q2 2015 Q2 2015 Q4 2015 Q1 2016
Trans Vol: 191 229 216 185 166 159Dollar
Vol: $4.06b $3.94b $3.14b $3.69b $7.95b $3.35b
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
Ariel Property Advisors | 122 East 42nd Street, Suite 1015 - New York NY 10168 | 212.544.9500 | arielpa.nyc | 6
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25+33+42+A
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25+50+25+A9+41+50+A17+47+36+A70+25+5+A51+37+12+A51+40+9+A69+22+9+A
SEP 2015 - FEB 2016 TRAILING NUMBERS SEP 2014 - FEB 2015 TRAILING NUMBERS
Location /Criteria
Total Transactions
Total Buildings
Traded
Total Dollar
Value Traded
Median Price
Total Units
Traded
Median Units /
Transaction
Total Transactions
Total Buildings
Traded
Total Dollar
Value Traded
Median Price
Total Units
Traded
Median Units /
Transaction
Manhattan 77 142 $8,337,983,280 $14,625,000 15,869 20 88 122 $3,326,379,795 $13,325,000 5,845 24
N. Manhattan 56 109 $1,066,088,524 $8,450,000 4,099 33 77 153 $1,887,170,143 $8,500,000 7,642 36
Bronx 70 129 $703,115,101 $4,937,500 4,735 37 88 149 $626,728,563 $3,987,500 5,239 36
Brooklyn 91 125 $1,082,103,938 $6,100,000 3,036 20 112 188 $1,207,105,809 $4,800,000 4,234 20
Queens 40 56 $661,146,375 $7,650,000 2,627 34 33 68 $515,390,229 $4,300,000 2,341 16
Summary 334 561 $11,850,437,218 $7,844,377 30,366 25 398 680 $7,562,774,539 $6,637,500 25,301 26
TRAILING SIX MONTH PERFORMANCE: DEAL DISTRIBUTION BY TRANSACTION COUNT AND DOLLAR VOLUME
LEGEND: $20MM+ | $5-20mm | $1-5mm
PRICING INDICATORS & DISTRIBUTIONS
MANHATTAN N. MANHATTAN BRONX BROOKLYN QUEENS
32% 25% 9% 17% 25%
61% 50% 41% 47% 33%
7% 25% 50% 36% 42%
MANHATTAN N. MANHATTAN BRONX BROOKLYN QUEENS
93% 70% 51% 51% 69%
7% 25% 37% 40% 22%
0% 5% 12% 9% 9%
Pri
cin
g In
dic
ato
rs
Location /Criteria
Avg. $/Unit Avg. $/SF Avg. Cap Rate Avg. GRM Avg. $/Unit Avg. $/SF Avg. Cap Rate Avg. GRM
Manhattan $680,840 $930 3.67% 19.56 $671,244 $889 3.78% 18.32
N. Manhattan $295,501 $365 3.99% 15.11 $256,918 $297 4.39% 13.49
Bronx $142,312 $171 5.22% 10.54 $113,695 $131 5.72% 8.92
Brooklyn $340,757 $396 4.09% 17.71 $274,029 $321 4.79% 13.93
Queens $251,931 $289 3.96% 15.33 $204,728 $256 5.24% 12.40
Multifamily Month In Review | New York City
7 | Ariel Property Advisors | 122 East 42nd Street, Suite 1015 - New York NY 10168 | 212.544.9500 | arielpa.nyc
ABOUT ARIEL PROPERTY ADVISORS
EXCLUSIVE MARKET REPORTS ASSET EVALUATIONS
INVESTMENT SALES, INVESTMENT RESEARCH & CAPITAL SERVICES QUALITY BROKERAGE SERVICES
Ariel Property Advisors is a commercial real estate services and advisory company located in New York City.
Our company is unique to the industry in that it is structured like an investment bank, with separate divisions for investment sales, capital services and research. This strategic approach to commercial brokerage services allows our professionals to deploy greater resources and provide consistent, seamless execution to every transaction.
We cover all major commercial asset types throughout the New York metropolitan area, but maintain a very sharp focus on multifamily, mixed-use, development, commercial and industrial properties.
From consultation through closing, our professionals are dedicated to achieving optimal results for our clients. Combining the insights of veteran brokers with the latest real estate market intelligence, we find solutions that meet the specific needs of both the client and the asset.
Cultivating long-lasting relationships with the real estate community is essential to the success of both our firm and our cli-ents, so we encourage all market participants to use our company as a resource.
Contact us today for Asset Evaluations, listing information, financing opportunities or our latest market reports.
INVESMENT SALES
Shimon Shkury ext. 11 Victor Sozio ext. 12 Michael A. Tortorici ext. [email protected] [email protected] [email protected]
Randy Modell ext. 17 Jonathan Berman ext. 20 Scot Hirschfield ext. [email protected] [email protected] [email protected]
Howard Raber ext. 23 Daniel Wechsler ext. 44 Mark Spinelli ext. [email protected] [email protected] [email protected]
Daniel Tropp ext. 26 Jesse Deutch ext. 18 Jason Gold ext. [email protected] [email protected] [email protected]
Matthew Gillis ext. 42 Marko Agbaba ext. 32 Joshua Berkowitz ext. [email protected] [email protected] [email protected]
Nathan Singer ext. 48 Jesse Greshin ext. 5272 Joshua Kwilecki ext. [email protected] [email protected] [email protected]
INVESMENT RESEARCH
Ivan Petrovic Aryeh Orlofsky Daniel [email protected] [email protected] [email protected]
David Baruch Brett Campbell Dusan [email protected] [email protected] [email protected]
Sam Stuart Spencer [email protected] [email protected]
The information contained herein has either been given to us by the owner of the property or obtained from sources that we deem reliable. We have no reason to doubt its accuracy but we do not guarantee the accuracy of any information provided herein. As an example, all zoning information, buildable footage estimates and indicated uses must be independently verified. Vacancy factors used herein are an arbitrary percentage used only as an example, and does not necessarily relate to actual vacancy, if any. The value of this prospective investment is dependent upon these estimates and assumptions made above, as well as the investment income, the tax bracket, and other factors which your tax advisor and/or legal counsel should evaluate. The prospective buyer should care-fully verify each item of income, and all other information contained herein. April 14, 2016 8:56 PM
OUR METHODOLOGY
The multifamily transactions included in the analysis occurred at a mini-
mum sales price of $1 million, with a minimum gross area of 5,000 square
feet and with a minimum of 10 units. Our estimated sales statistics reflect
all data available on public records and through other sources we deem
reliable.
TYPES OF TRANSACTIONS CONSIDERED:
Transactions in which there was a transfer of ownership and deed docu-
ment recorded on ACRIS were considered. Data is collected form public
sources and other sources we deem reliable.
LOCATION DEFINITIONS:Manhattan - South of East 96th Street, South of West 110th StreetNorthern Manhattan - North of East 96th Street, North of West 110th StreetThe Bronx - Bronx BoroughBrooklyn - Brooklyn BoroughQueens - Queens Borough
Whether you are considering selling your building or you just want to know the current market value of your property, we are available to provide you with a complimentary asset evaluation. Produced by the joint efforts of our investment sales and investment research teams, an Asset Evaluation will provide you with a thorough analysis of your investment property, and will detail our future marketing efforts on your behalf.
COMPLIMENTARY ASSET EVALUATIONPlease call us at 212.544.9500 to request an Asset Evaluation
COMPILED BY:
If you would like to use or quote this report on the web, we ask that you quote the source as “Multifamily Month In Review: New York City by Ariel Property Advisors” and link report from our website page (http://arielpa.nyc/research/reports/)
