Commercial-property demand is shifting to Northern Manhattan and Brooklyn, where apartment buildings are attracting investors while office prices stagnate, according to brokerage Massey Knakal Realty Services.
Sales of properties in upper Manhattan, above 110th Street on the west side and above 96th Street on the east, hit $441 million in the first half of this year, triple the number for the same period in 2011, Bloomberg reports. Deals in Brooklyn rose 60 percent to $1.53 billion, in comparison to a 14 percent increase to $14.4 billion for all of New York City.
“Northern Manhattan has been on fire,” Massey Knakal chief executive officer Paul Massey said at a press briefing. Almost 3.4 percent of the properties in the area changed owners during the first half of 2012, the most of any section in the city. About $300 million, or 68 percent, of upper Manhattan sales in the first half of this year were for elevator or walk-up apartments.
Sales in upper Manhattan, especially in Harlem, Washington Heights and Inwood, are rising partially because major investors such as AREA Property Partners LP are selling real estate they bought near the market peak five years ago, Massey Knakal VP sales Robert Shapiro told Bloomberg.
Brooklyn is experiencing an oversized demand in development sites, which consist of about 17 percent of deals. Of that amount, roughly three-quarters of transactions are in Williamsburg, Greenpoint and downtown Brooklyn, said Massey Knakal director of sales Michael Amirkhanian. Buyers are particularly interested in the Atlantic Yards area, where the National Basketball Association’s Brooklyn Nets’ new arena will open later this year.