Commercial Realty In NYC
Whether you would like to buy or sell, it’s important that you understand the commercial realty trends in NYC. This will help you determine the best course of action.
The commercial realty market is different from the residential real estate market that tends to be seasonal. The commercial market remains steady year round in New York only experiencing a slow down around the holiday season. Here’s what’s happening in NYC’s commercial reality market and what it means to you.
Property prices
Manhattan has a reputation for premium priced properties, however, in recent history, they have been priced lower than usual. This shift has come due to the 1031 tax code that allows people to defer capital gains on real estate if they invest in a new commercial investment in 45 days. It’s important to seek the assistance of reality advisors when looking for property to invest in so they can easily guide you through tax codes and similar things that require their expertise.
Shoppers are getting savvy
There are still some challenges that come between the acceptance and signing of the contract between buyers and sellers. Most buyers these days are doing their homework and researching before signing a contract. Since there is no building that is perfect, it’s important to figure out everything that is wrong with the property before you make a final decision. This is a key part of the process that is often overlooked during the honeymoon phase of finding an office space.
Retail is looking to create customer experiences
Many retail stores are looking for creative ways to engage customers to come back to their stores. This is necessitated by the growing online retail market. The competitive eCommerce market has led to some of the biggest companies to open retail stores all across NYC. These traditional internet companies should be careful when negotiating terms for large retail spaces. It’s important to seek commercial realty brokers to help with things like negotiations.
Interest rates
The Federal Reserve has announced that they will be raising interest rates by a quarter of a percentage point. The Treasury has also moved up more than 50 basis points since the presidential election. It now hovers around 2.5% above the rate hike.
The new rates can provide an incentive for both lenders and borrowers who might become more cautious. The higher interests also show that the economy is doing well and is an overall positive sign for NYC real estate markets.
More offices space is coming to Manhattan
The office space market is growing in Manhattan. The vacancy rate has gone below 15%. Most of the upward trend is seen in the high-end and Midtown markets. However, the downtown market has seen rising vacancies with negative absorption and falling rent prices. If you plan to buy an investment property, commercial realty partners can help you locate the best location for your property. Just ensure that you pick a commercial real estate broker that has deep connections in the market.
Low capitalization rates
Many Manhattan buildings are being acquired at low capitalization rates. This analysis by commercial realty associates may be dampened if the interest rates continue to go up. However, as said earlier, there is high demand for commercial property compared to the supply, which is likely to keep the market very active and competitive in the near future.
Spaces