The Reel

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A blog for breaking sales and neighborhood real estate news.

Without a doubt, the NYC property sales market has rebounded. Our office tracked $25.6B in trades last year, which was an 80% increase from 2010 and approaching the 7 year average of $30B. There are several reasons for this recovery ranging from low interest rates to increased foreign demand. However, the one that stands out in my mind is that NYC was not overbuilt in this last cycle.

While major cities around the world added tens of millions of square feet in 2008-2009, Manhattan added just one speculative office building: 11 Times Square. Due to its timing, the building still sits partially vacant. As unfortunate as this is, can you imagine if there were ten more buildings constructed at the same time?

If NYC did overbuild, the vacancy rate would certainly be much higher than the 11.7% that CBRE reports in Midtown. There also wouldn’t be nine signed at over $100/SF this year already.

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