-- Year-over-year, Chinese investment fell 62 percent and German investment fell 64 percent, report shows --
International investors retreated from the New York City commercial real estate market in 2017, which contributed to the 41 percent year-over-year decline to $23 billion in Manhattan’s investment property sales, according to Eastern Consolidated’s research report View from the Street.
“The slowdown is a reflection of a turning market, and when a market turns there tends to be a lull in sales activity as buyers and sellers adjust their expectations,” said Peter Hauspurg, Chairman and Chief Executive Officer.
The market saw a significant retrenchment by international investors, as countries that recorded over $1 billion in sales in 2016 pulled back in 2017. Chinese buyers invested $2.5 billion in Manhattan commercial real estate in 2017, a 62 percent decline from the previous year; German buyers invested $838.5 million, a 64 percent decline; UK buyers invested $188 million, an 87 percent decline; Canadian buyers invested $1 billion, a 19 percent decline; and buyers from Hong Kong invested $547 million, a 55 percent decline. In addition, Israeli investment fell 74 percent year-over-year to $180 million.
International buyers still accounted for more than a third of the sales in Manhattan in 2017, although that was a decline from a 42 percent market share in 2016. REITs increased their market share to 15 percent, up from 3 percent last year, while institutional buyers accounted for 19 percent of the sales, a 28 percent decline from 2016.
According to the report, the West Village and Chelsea attracted more investment dollars in 2017 than 2016, with the West Village showing a 146 percent increase in dollar volume to $1.16 billion, and Chelsea showing an 8 percent increase in dollar volume to $2.1 billion. The remaining neighborhoods posted year-over-year declines.
View from the Street, Neighborhood Overview: Manhattan provides an overview of the market and a summary of investment sales, asking retail, office, and multifamily rents, and condo sales in every neighborhood in Manhattan. The report is available by clicking here.
Eastern Consolidated
Powered by a highly skilled team of over 100 brokers with a fluency in 15 languages, Eastern Consolidated is one of the country’s preeminent full-service commercial real estate firms. Through three core divisions—Investment Sales, Capital Advisory, and Retail Leasing—Eastern Consolidated serves an impressive roster of international and domestic institutional and private investors on real estate transactions of all sizes and across all property types. For more information, visit www.easternconsolidated.
