Why a Specialized Team is Even More Important in 2019
Despite Law Changes NYM Team Produces $800,000,000+ of Multifamily Activity
It’s been a busy year for New York City real estate owners. Throughout the year all participants were full of uncertainty about the NYC real estate landscape. In June, the “2019 Rent Reform Act” immediately implemented state-wide rent caps on rent-stabilized apartments and more strict landlord controls. Despite the changes, our team saw $827,505,000 in activity since June 15th. Let’s dive into why and what we think it means for the market.
While we all knew the laws were coming, about 90% of owners we surveyed felt the laws were worse than expected. The industry has become much more complex. These laws have disrupted the market and your world as an investor might feel chaotic right now. Many owners are probably asking themselves questions like:
- What’s my property worth?
- Who’s going to buy it?
- If I’m going to buy something, what’s my business plan?
- How long do I plan on owning a property?
- Are there additional risks that could be coming down from the industry or political risks that I’m unaware of?
When the market shifts dramatically, it becomes more important than ever to work with specialists. Owners should surround themselves with experts who understand the market, the laws, and the owner’s specific investment goals.
In an environment where many investors were unsure of what to do next, New York Multifamily’s team of specialists worked with our clients to ensure they were making the right moves even though rent reform is now our reality. The investors who have made moves over the past 90 days have done so with specific goals, now that they are certain of the business environment.
Brooklyn Brings It
Most of our listings this quarter were in Brooklyn. Out of 41 listings, 17 of those were in Brooklyn. And about 76% of those are smaller buildings that were listed for less than $10,000,000, such as 6902-6906 3rd Avenue, 70 7th Avenue, and 115 Congress Street. One of the larger listings in the popular borough is 15 Crooke Avenue in Prospect Park, a 54-unit elevator building that’s listed for $17,700,000.
The borough also tied with Manhattan for most closed sales this past quarter, with nine sales totaling $30,000,000. Most of these Brooklyn units sold in the $1-4 million dollar range.
As mentioned above, we saw the highest number of sales in Manhattan and Brooklyn in Q2 of 2019. However, most of our team’s sales in Manhattan were in the $10-40 million dollar range. Some notable ones were 186 Franklin Street in Tribeca for $37,370,000 and 81 Wadsworth Avenue for $13,135,000. The team sold over $133,000,000 of Manhattan assets during the 2nd Quarter.
Success in Queens
The team also closed a handful of sales in Queens totaling over $46 million. One of the most notable sales in this borough was 6107-6125 Woodside Avenue – which contained 150 units across 108,886 square feet – for $36,375,000. Check out the success story about this sale here to learn how this deal came together and how both the buyers and sellers met their goals.
Looking Toward Q4
At the time of this writing the NYM team has placed 19 assets under contract since June 15th. We view this as a signal that the law is causing action for some owners and a wait and see approach for others. Listing activity is increasing, and the final quarter of 2019 is appearing to be more active than the previous three.
And as we move into Q4, it’s clear that rent reform is here to stay. To navigate these new laws, I recommend checking out this blog I wrote last quarter. It’s all about the questions you as an investor should be asking yourself in this post-rent reform world, like “What’s my asset worth?” and “How should my management strategy change?”
I also recommend that you check our latest podcast series about the new rent laws. I gathered a few of my favorite industry experts to talk all about the new laws and how they may impact owners like you. Listen here or by clicking below.
If you’d like to learn more about how to navigate the rent laws by working with a team of specialists, feel free to email me below.
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