In the second quarter of 2024, New York City experienced strong activity in its multifamily market, with a total dollar volume surpassing $2.8 billion. This marked a significant increase of 108% from the previous quarter and was the best performance since Q2 of 2023, according to Ariel Property Advisors’ Q2 2024 Multifamily Quarter in Review for New York City. The number of transactions also saw an uptick by 4%, reaching a total of 265 deals.
President and founder Shimon Shkury attributed this growth to mortgage maturities as one of the main drivers for multifamily sales during this period. He expects this trend to continue, particularly for rent-stabilized properties which made up more than half (50%)of all transactions in Q2.
Two notable free market sales that took place during this time were Carlyle Group and Gotham Organization’s purchase of Mahatta’s Upper West Side property at200 W.67th St.for $265 million due to mortgage maturity and expirationofa421a tax exemption.Additionally,the bulk condominium sale at9 Dekalb Ave.in Downtown Brooklyn(pictured)for$672 million throughadeed-in-lieuofforeclosurewas influenced by maturing mortgages.The mezzanine lender,Silverstein Capital Partners,took over from JDS Development after acquiringtheseniorloanfromOtéraCapital.
Shkury further commented onthe current stateofthe multifamily market,statingthat there is ample capital available forall typesofsassets.Institutional,private,and international investors are interestedinfree-marketproperties;private family offices are seeking out rent-stabilized assets;andmission-driven organizationsare investingin affordable housing.Our report indicates that pricing has significantly adjusted across all categories within themultifamily sectorwith values droppingbyapproximately30to60%for investments inrent-stabilized buildings.
