Archive for the 'Market Watch' Category

New York City multifamily transactions increased 21 percent and the dollar volume of those deals rose 18 percent in March compared to February, according to Ariel Property Advisors’ Multifamily Month in Review: New York City for March.

This week we’re highlighting the positive April jobs report, increases in home prices in the country’s major metro areas, proposed increases for NYC rent stabilized apartments, and year-over-year increases in free market rents in Manhattan and Brooklyn.

The U.S. created 165,000 jobs in April and revised its previous monthly estimates upward to 332,000 new jobs in February and 138,000 new jobs in March. In April, the lower paying retail and restaurant sectors hired 68,000 workers, while the government cut its workforce by 11,000. In a separate survey, the unemployment rate fell to 7.5 percent, which is above the 6.5 percent rate the Fed has stated the economy must reach before the central bank ends its stimulus program.

The S&P/Case Shiller index showed that average U.S. home prices in the 10- and 20-City Composites increased 8.6 percent and 9.3 percent in the 12 months ending in February 2013, their highest annual rate of growth since May 2006. Seasonally adjusted monthly data show all 20 cities saw higher prices for two months in a row for the first time since early 2005. Home prices in the New York Metro area posted a year-over-year increase of 1.9 percent.

Proposed increases for rent stabilized apartment leases beginning on Oct. 1, 2013, have been adopted by the NYC Rent Guidelines Board. The proposal calls for increases for one-year renewal leases ranging from 3.25 percent to 6.25 percent, and increases for two-year renewal leases ranging from 5 percent to 9.5 percent.

Average rents in Manhattan increased 5 percent in April 2013 from April 2012 – to $3,800 from $3,619, according to MNS’ Manhattan Rental Report. Increases were greatest in Greenwich Village (9.9 percent), TriBeCa (8.7 percent), Harlem (8.3 percent), and the Upper East Side (7.7 percent). Non-doorman studios in Midtown East and non-doorman two-bedroom units in SoHo appreciated 26.3 percent and 23.8 percent respectively. Murray Hill was the only neighborhood posting negative growth of 1.8 percent year-over-year.

Since April 2012, average Brooklyn apartment rents increased by $122 from $2,364, according to MNS’ Brooklyn Rental Report. Year-over-year, average rents for studios increased 6.51 percent, two-bedrooms increased 5.8 percent, and one-bedrooms increased 3.35 percent. The most expensive one- and two-bedrooms on average were found in DUMBO ($3,779 and $5,467, respectively) and the least expensive one- and two-bedrooms were in Bay Ridge ($1,514 and $1,984, respectively).

NYC construction employment rose to 111,333 in the first quarter of 2013, up 1.3 percent from the same period a year ago and up 5.4 percent from the first quarter of 2011, according to a NY Building Congress analysis. Construction employment for all of 2012 averaged 114,875, up from an average of 112,192 jobs in 2011. Average construction industry employment is still down 13 percent from 2008, when construction was at its peak.

An RFP for Phase II of the Hunter’s Point South development area on the Queens waterfront has been issued by the NYC Department of Housing Preservation and Development. Phase II includes all of Parcel C bordered by Center Boulevard, Borden Avenue, 2nd Street, and 54th Avenue. The plan calls for a mixed-income development with up to 1,000 residential units, of which 50-60 percent will be permanently affordable to working-class New Yorkers. The site also will include about 28,000 square feet of retail space and possibly a community facility space and residential parking.

Major retail projects are underway in The Bronx including a multilevel, 135,000-square-foot shopping center that Equity One Inc. is planning to open in 2014 at 171 W. 230th Street in the Kingsbridge section, and a 162,000-square-foot shopping center eight blocks north on Broadway that Metropolitan Realty Associates and Angelo Gordon & Co. are building on the former Stella D’Oro factory site. Related Co. opened the three-story Bronx Terminal Market in 2009, and Prestige Properties is developing a 780,000-square-foot Mall at Bay Plaza at the intersection of I-95 and the Hutchinson River Parkway.

A rooftop garden at the affordable and “green” housing complex Intervale Green in the Crotona Park East section of The Bronx is proving popular with 16 families tending their own plots. Intervale Green, which opened in 2009, was developed by the Women’s Housing and Economic Development Corporation (WHEDco). The farm was started the following year with a $40,000 grant from the United Way.

This week we’re highlighting unemployment figures for the city and state, an encouraging report from Fannie Mae, how co-ops are capitalizing on their retail spaces, and the business boom taking place in The Bronx.

New York City’s unemployment rate fell to 8.9 percent in March from 9.1 percent in February and 9.4 percent in March 2012, the New York State Department of Labor reported. The report also showed that in the last year, New York City has seen a net gain of 57,900 private sector jobs. The New York State economy added 14,100 private sector jobs in March 2013, resulting in New York reaching an all-time high private sector job count of 7,426,100. The state’s unemployment rate fell to 8.2 percent in March from 8.4 percent the month before.

The tight housing inventory nationwide is boosting prices for new and existing homes, which should soften the impact of tax increases and government cuts, according to a Fannie Mae report. In 2013, the agency is forecasting that existing home prices will rise 5.1 percent to a median of $186,000, prices for new homes are expected to increase 4.1 percent to a median of $254,000, and existing home sales are expected to increase 6.9 percent to 4.98 million.

Owners of co-ops with retail spaces are benefiting from a change in the tax law that allows them to charge market rents for the commercial spaces in their buildings. Prior to 2007, federal tax law prohibited co-ops from receiving more than 20 percent of their income from sources other than tenant-shareholders or risk losing their status as a co-op. As a result, co-ops charged below market rents for retail space to stay in compliance. Now many of those leases are expiring, which is enabling co-ops to earn more income and pass the savings on to residential shareholders.

Entrepreneurs have discovered The Bronx, a trend confirmed by a Center for an Urban Future report showing that between 1991 and 2011, the borough quadrupled the number of new business incorporations to 4,690. Because The Bronx has the lowest commercial rents in the city, it is attracting businesses that have been priced out of Manhattan and Brooklyn as well as homebuyers and renters looking for bargains. New businesses include coffee shops, restaurants, beer brewers, accountants, and more.

Although the Bloomberg administration has implemented an ambitious affordable housing program to finance the preservation and construction of 165,000 units of housing, Democratic mayoral candidates say the city should be doing more. The NY Times highlighted a housing report that found of the 38,670 units developed by the city from 2009 to 2011, only one-third were affordable for households making the median income or less for the average household in their neighborhood. The article also pointed out that thousands of affordable units are “aging out” as their compliance period expires.

New retailers and services are moving into East Harlem including La Casa Azul, a bookstore that caters to the community and hosts local events, and a cable TV station that allows local residents to use production equipment and high-definition studios, according to a WSJ profile of the neighborhood. Newly renovated retail spaces also are available at 1636-1642 Lexington Avenue, and across the street, a 42-unit condo development with a ground floor supermarket is under construction.

The city’s Landmarks Preservation Commission has voted to expand the Stuyvesant Heights historic district in Bedford Stuyvesant, tripling the size of the existing district to cover 1,255 properties. The plan calls for the district’s boundaries to expand to Tompkins Avenue, Macon and Halsey Streets, Malcolm X Boulevard and Fulton Street. The goal is to protect property values and preserve community history. The measure will now go before the City Council for a final vote.

Officials from Local Initiatives Support Corporation (LISC) and other agencies have started holding public meetings to seek input from residents of the Mott Haven neighborhood of The Bronx on how to use a two-year, $300,000 federal planning grant. The grant was awarded to NYCHA to improve local housing, schools, parks, public safety, economy, and other elements that shape the neighborhood. Mott Haven has more than 80 public housing buildings in five developments. Of the community’s 46,000 residents, about 17,000 live in public housing.

This week we’re highlighting the March rental reports for Manhattan and Brooklyn, the mediocre U.S. jobs report, and new projects for The Bronx.

Across the board, Manhattan rental prices increased in March 2013 compared March 2012, according to MNS’ Manhattan Rental Market Report. Non-doorman studios increased 10 percent to $2,406, non-doorman one-bedrooms increased 7.9 percent to $3,167, and non-doorman two-bedrooms rose 3.1 percent to $4,338. Doorman studios increased 5.1 percent to $2,770, doorman one-bedrooms increased 5.3 percent to $3,900, and doorman two-bedrooms rose 4.1 percent to $6,033. The most expensive rents recorded were in Tribeca and Soho, while the least expensive rents were in Harlem.

MNS’ Brooklyn Rental Market Report for March 2013 also showed year-over-year increases. Rents for studios rose by 7.8 percent to $1,844, one-bedrooms increased 2.4 percent to $2,363, and two-bedrooms increased 3.7 percent to $3,095. The most expensive apartments were found in Williamsburg and DUMBO. Overall rents in Brooklyn fell by 1.77 percent from the previous month.

Economists forecasting that 200,000 new jobs would be created in March were disappointed by the Labor Department’s report that only 88,000 jobs were added to the U.S. economy last month. Some analysts blamed the federal government’s $85 billion in budget cuts, which has sparked layoffs at government contractors and is expected to trickle down to the rest of the economy in the second and third quarters. In a separate survey, the unemployment rate was 7.6 percent in March because the number of people in the workforce declined.

The Department of Housing Preservation and Development is requesting proposals from developers to build affordable housing on two sites near the Hub in the Melrose section of The Bronx. Zoning for the 185,000 square foot development site allows for 1 million buildable square feet. Proposals are due July 3. The initiative is part of the Bloomberg Administration’s New Housing Marketplace Plan to finance the construction or preservation of 165,000 units of affordable housing by the close of the 2014 fiscal year.

A “vision plan” to revitalize Webster Avenue in The Bronx has been released by New York City Economic Development Corporation. “ The plan seeks to make Webster Avenue a place to live, work, shop, and enjoy unique cultural experiences – as well as a hub for entrepreneurs, researchers and students to foster new businesses and academic collaborations,” according to NYCEDC. The corridor, which was rezoned in 2011, links Gun Hill Road, E. 204th Street, Bedford Park Boulevard, and Fordham Road and is surrounded by Fordham University, Montefiore Medical Center, The New York Botanical Garden, and The Bronx Zoo.

Culture Shed, an exhibition and event space venue, is being proposed for Hudson Yards adjacent to the High Line. The design calls for four levels of galleries, an open-air café, and a 125-foot-tall shell that could be extended from the building over the plaza and more than double the first floor space. Promoters say the Culture Shed’s expanded shell could be used for a number of activities including a farmers market, skating rink, ticketed concerts, and theatrical performances.