Commercial Real Estate: The strength of multifamily in Upper Manhattan by Weiser

As Manhattan multifamily remains competitive, there are key pockets in the market that offer an opportunity for a substantial return on investment. While we continue to track emerging and well-performing neighborhoods, Upper Manhattan properties in particular are offering high upside potential in the near future. Recent investment and development activity shows that Upper Manhattan multifamily product is in demand. Year over year, our company experienced a huge spike in Manhattan sales (234%), and the majority of these transactions (76%) are spread across Harlem up through Washington Heights. Furthermore, several deals we arranged within the last year demonstrate first-hand the value of multifamily in Upper Manhattan neighborhoods and the potential for impressive returns. For example, in September, we arranged the sale of a prime development site situated in East Harlem. In this case, we worked closely with the buyer, who saw an opportunity to develop in an up-and-coming neighborhood and was drawing up plans for a rental community. Last summer, we also arranged the acquisition of a mixed-use property in Washington Heights, which has nearly doubled in value from two years ago. In a banner deal, we also arranged financing and brokered the sale of a multifamily portfolio in Hamilton Heights – a transaction that was reflective of growing investor interest in the neighborhood. Multifamily activity in these neighborhoods has only accelerated and we expect this trend to continue well into 2016. Closing out 2015, we completed the $34.1 million sale of a portfolio of six Upper Manhattan buildings, comprising of a total 109 apartments and nine retail spaces across 89,873 s/f. Quickly following that transaction, we arranged the $98 million sale of a portfolio of 13 multifamily properties in Harlem and Washington Heights. It’s no surprise that investors and developers alike are attracted to Upper Manhattan multifamily properties. With an influx of new restaurants and hotspots, we only expect that this interest will grow with a diversified group of investors capitalizing on the opportunity to own and development multifamily buildings in the area. Michael Weiser is the president of GFI Realty Services, Inc., an affiliate of GFI Capital Resources Group, LLC, New York, N.Y.