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REBNY Investment Sales Report: Number of Transactions Down 18% Year-Over-Year with Multi-Family Residential Consideration Declining 52% Year-Over-Year
February 26, 2020
In the second half of 2019, total citywide consideration (total monetary value of all recorded sales), reached $18.6 billion, a 14% decrease year-overyear, according to the Real Estate Board of New York’s (REBNY) latest Investment Sales Report.
The total number of transactions declined 18% year-over-year to 1,716 total transactions. Overall sales consideration of multifamily residential buildings decreased 52% year-over-year and transactions decreased 38% year-over-year.
Rent-stabilized buildings saw the biggest decline, with total consideration down 73% year-overyear, from $5.7 billion to $1.6 billion. All five boroughs experienced significant declines in both consideration and transactions of rent stabilized buildings.
The decline in rent-stabilized buildings resulted in a major decline in transfer tax revenue from the sale of such buildings, which declined by $136 million year-over-year.
“This new analysis is a clear indication that new rent laws will result in less tax revenue for New York City and State,” said James Whelan, REBNY President. “If we want to be a progressive City, we need to be a prosperous one. This report is a sign that it will be increasingly more difficult to pay for vital government services.”
Among the other findings from REBNY’s report:
- Sales consideration for office buildings ($8B) increased 15% from the first half of 2019, and 23% year-over-year. Office buildings represent the majority of citywide total consideration (42%).
- Sales consideration of multifamily rental buildings with elevators ($2.3B) decreased 8% from the first half of 2019, and 52% year-over-year.
- Sales consideration of multifamily rental buildings without elevators ($1.4B) decreased 21% from the first half of 2019, and 52% year-over-year.
- Sales consideration for retail property ($1.3B) decreased 48% from the first half of 2019 and 25% year-over-year. However, retail transactions increased 5.5% from the first half of 2019 and 1% year-over-year.
- Sales consideration for industrial sales ($1.6B) decreased 24% from the first half of 2019 and increased 71% year-over-year.
- The five largest investment transactions by sales price, all of which occurred in Manhattan, were as follows:
- The $909 million sale of an office building at 711 Fifth Avenue in Manhattan.
- A $617 million sale of an office building at 425 Park Avenue in Manhattan.
- A $565 million sale of an office building at 1334 York Avenue in Manhattan.
- A $345 million sale of an office building at 351 Park Avenue South in Manhattan.
- A $340 million sale of a multifamily rental at 1307 Fifth Avenue in Manhattan.
INVESTMENT SALES BY BOROUGH
The total number of transactions across the five boroughs was 1,716 in the second half of 2019, with all five boroughs seeing a decline in investment sales.
Manhattan: Investment sales totaled $12.3 billion, a 13% increase in consideration year-overyear. Similar to the other boroughs, Manhattan has a 25% decline in the total number of transactions year-over-year. Office sales represented the majority of investment sales in Manhattan, with 58% of total consideration in the borough totaling $7.2 billion – a 16% increase year-over-year. The biggest decline in Manhattan investment sales transactions were for multifamily rental buildings without elevators, down 67% year-over-year.
The Bronx: Investment sales totaled $874 million, a 25% decrease in consideration year-overyear. The number of Bronx investment sales transactions declined 24% year-over-year. Multifamily rental without elevators buildings decreased 55% year-over-year in total consideration and 44% in transaction volume.
Brooklyn: Investment sales totaled $3.2 billion, a 7% increase in consideration year-over-year. Brooklyn investment sales transactions decreased 15% year- over-year. Industrial sales increased 44% year over year, to $626 million. Brooklyn multifamily investment sales experienced a 30% decrease in sales consideration yet a 42% increase in transaction volume year-over-year.
Queens: Investment sales totaled $2.04 billion, an 24% decrease in consideration year-overyear. The number of investment sales transactions declined 4% year-over-year. Queens office consideration increased 209% year over year, to $452 million. Multifamily with elevator total consideration declined 92%, from $1.3 billion in the second half of 2018 to $110 million in the second half of 2019. Multifamily without elevator consideration declined 27%, from $227 million to $167 million.
Staten Island: Investment sales totaled $219 million, a 24% decrease in consideration yearover-year. All sectors of investment sales declined year over year. In the second half of 2019, there were no transactions for multifamily buildings with an elevator in Staten Island.
INVESTMENT SALES HIGHLIGHTS BY PROPERTY CATEGORY
Multifamily Rental, Elevator: In Manhattan, multifamily rentals with an elevator accounted for 35 sales or 11% of the borough’s transactions. Those 35 transactions made Manhattan the borough with the most transactions throughout all five boroughs. Citywide, there were 68 transactions that accounted for 4% of overall transactions.
Multifamily Rental, No Elevator: Citywide, multifamily rentals without an elevator accounted for 497 sales or 29% of transactions in the city. Brooklyn, by the number of transactions, had 230 registered sales, the largest amount of all five boroughs, for 37% of the borough’s transactions.
Office: Sales in the office category totaled $8 billion, accounting for 43% of the city’s total investment sales consideration. In Manhattan alone, office buildings accounted for 81 transactions, or 26% of the borough’s transactions.
Garages / Gas Stations / Vacant Land: Sales in this category accounted for 11% of all citywide transactions. This was the most active category in Brooklyn, accounting for 110 transactions, or 17% of the borough’s transactions.