First Half 2018 NYC Investment Sales Report

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EXECUTIVE SUMMARY 

In the first half of 2018, New York City’s investment sales market showed signs of improvement from a slow second half of 2017. The total consideration, or total monetary value for all recorded sales, was $21.6 billion, a 20 percent increase compared to $18 billion the first half of 2017. The total number of transactions was 2,200, a nine percent decrease compared to the 2,419 sales in the first half of 2017.

Key Findings

Investment sales activity in Manhattan garnered more dollar consideration than in the other boroughs in the first half of 2018, accounting for $13.7 billion, or 64 percent, of total citywide consideration and 420, or 19 percent, of the total citywide transactions.

Total consideration in the investment sales market increased in Manhattan, Brooklyn, and Queens when compared to the first half of 2017.

The 138 citywide sales of multifamily rental buildings with an elevator totaled $4.2 billion in consideration in first half of 2018, which was more than double the $1.9 billion sold in the first half of 2017.

Sales consideration for the 15 hotels sold in the first half of 2018 was $2.2 billion, an increase of 110 percent from $1.0 billion in the first half of 2017.

Citywide sales consideration for garages / gas stations / vacant land rose 79 percent to $1.6 billion in the first half of 2018 from $919 million in the first half of 2017.

Retail property sales totaled nearly $2 billion in the first half of 2018, a 43 percent increase from $1.4 billion year-over-year.

The five largest investment transactions (by sales price) in the first half of 2018 were:

  • The $2.40 billion sale of the office building at 75 Ninth Avenue in Manhattan
  • The $1.39 billion sale of the hotel under construction at 701 Seventh Avenue in Manhattan
  • The $870 million ‘Starrett City’ portfolio of rental apartment buildings with an elevator at 1255 Pennsylvania Avenue in Brooklyn
  • The $640 million office building at 1065 Sixth Avenue in Manhattan
  • The $640 million office building at 1731 Broadway in Manhattan

 

Sales Activity by Borough

Manhattan investment sales totaled $13.7 billion, a 28 percent increase in consideration from $10.7 billion in the first half of 2017. The number of transactions decreased slightly to 420 in the first half of 2018 from 467 in the first half of 2017. A few large transactions of multifamily rental buildings with an elevator, vacant land, and retail boosted total consideration in each of those categories (see table on page 3). 

Bronx investment sales transactions rose nine percent year-over-year to 392 from 361. Meanwhile, the dollar consideration for all Bronx investment sales declined seven percent to $1.2 billion in the first half of 2018. The Bronx and Staten Island were the only boroughs to observe decreases in total sales consideration compared to the first half 2017.

Brooklyn experienced robust investment sales consideration posting the highest recorded dollar consideration in the borough since the second half of 2016. Total consideration increased 16 percent year-over-year to $4.2 billion from $3.6 billion, while the number of transactions decreased 15 percent to 720 from 849. The most active asset categories in Brooklyn, by number of transactions, were multifamily rentals without an elevator, which registered 331 transactions, and garages / gas stations / vacant land, which recorded 114 transactions.

Queens investment sales consideration increased by seven percent to $2.2 billion in the first half of 2018 from $2.0 billion in the first half of 2017. The number of Queens transactions decreased by six percent year-over-year to 517 from 552. Multifamily rental buildings without an elevator garnered the most transactions, 135 or 26 percent of the borough’s sales, followed by garages / gas stations / vacant land, which recorded 115 or 22 percent of all sales in the borough.

Staten Island investment sales consideration saw a slight four percent drop to $287 million in the first half of 2018 compared to $300 million in the first half of 2017. Among Staten Island’s 151 total transactions, 66 or 23 percent  were garages / gas stations / vacant land. The highest-priced property in this category was the sale of the gas station at 741 Forest Avenue in West Brighton for $2 million.

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