Manhattan Commercial Condo Purchasing and You!

By Jesse Fishkin

2014 NYC; before purchasing any property it is vital to understand the market, you may just be amazed with what you’ll come to find. Explicitly for purchasing a new office these sales statistics will certainly give you a shock. Starting things off, the percent increase in vacancy throughout Manhattan seems to be getting better.

This however is due to the rise in new space being built in the market. “In Midtown, Midtown South, and Downtown combined, 5.5 million square feet of office space was completed last year. This compared to 68,000 square feet in 2012 and 135,000 square feet in 2011”.

However rent has escalated as well in Midtown, a 4.9% climb, Downtown 5.5% and a remarkable 9.5% increase in Midtown South. While these numbers are eyesores for a new buyer entering the market, they do not justify the increases in property values that have been observed in the office sector. In 2013 the average price per square foot was $952, an all-time record. This represented a 20.5% increase over 2012 and a massive 80.4% increase since the trough of the market in 2010. The increase in value moreover portrays the compression of cap rate rather than the increase in rent.

In 2009 the average cap rate on purchases was 6.9% and have decreased to 4.6% in 2013, making properties to be bought less affordable. The amount of sales in Manhattan’s office sector in 2013 as well followed a familiar path seen in other property sectors.

Although the market today may not seem in its best form with rising prices, the future is bright.

Poise yourself today for the purchase of tomorrow with Prime Manhattan Realty. Our brokers are more than qualified and experienced in the market that we are witnessing and can effectively guide you to the best possible purchase to suit your needs.

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