Daily Archives: October 19, 2011

NYC Commercial-Property Dollar Volume Fell in Third Quarter – Bloomberg

The dollar volume of New York City commercial-property sales fell 25 percent in the third quarter from a three-year high, Massey Knakal Realty Services said.

Deals totaled about $6.5 billion in the three months through September, down from $8.7 billion in the second quarter, according to a report by the brokerage. The report included transactions for offices, apartment buildings, hotels, retail properties and development sites across the five boroughs.

The decline in dollar volume “might be interpreted as a slowing down in the market,” Chairman Robert Knakal said today at a press briefing. “But if you eliminate the second quarter, the $6.5 billion in the third quarter was the best quarterly total going back to the third quarter of 2008.”

Constrained supply and a pullback in the market for commercial-mortgage backed securities limited deals for the largest properties, Knakal said. The city is on a pace for about $25 billion of commercial real estate transactions this year, about an 80 percent increase over 2010 and close to the $25.3 billion sold in 2008, according to the report.

Manhattan Sales

Manhattan south of 96th Street on the east side and south of 110th Street on the west side accounted for the majority of third-quarter dollar volume. Sales in those areas totaled about $5.7 billion, a 28 percent drop from the previous three months. Deals for office buildings made up 40 percent of the dollar volume, according to the brokerage, which specializes in small to midsize transactions.

Events that roiled investment markets in the quarter, such as the budget debate in Congress, the Standard & Poor’s downgrade of the U.S. credit rating and Europe’s debt crisis, failed to slow sales of certain property types and in some neighborhoods, Massey Knakal executives said.

Brooklyn, for example, is poised to have its first year with more than $1 billion in transactions since 2008, when just over $2 billion of deals were struck, said Michael Ambrosio, a broker with Massey Knakal. Apartments led deals, comprising 150 of the 529 properties sold in the borough this year.

Small private-equity firms new to the market are helping to drive sales in Brooklyn, according to Ambrosio. Areas near the Atlantic Yards development in the borough’s downtown are attracting interest, along with Bedford-Stuyvesant and Crown Heights, he said.

First-Time Buyers

Demand from buyers new to the city is helping to prop up the property market as “unrest in Europe and the potential impact on global markets has investors feeling a bit more cautious,” Knakal said.

Among the newer buyers is UDR Inc., a Highlands Ranch, Colorado-based apartment landlord that has purchased $1.2 billion of New York properties this year, accounting for 7 percent of Manhattan deals, according to James Nelson, a Massey Knakal partner.

It’s too early to tell whether the decline in volume in the third quarter will carry over into the next three months, Knakal said. The city’s job growth has been “lackluster,” he said, and there’s still “very significant shadow distress” in the market, with hundreds of buildings that are worth less than their mortgage balance yet still have positive cash flow because of low interest rates.

“We think there’s going to be a lot of upward pressure exerted on rates,” Knakal said.

To contact the reporter on this story: David M. Levitt in New York at dlevitt@bloomberg.net

To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net

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Chappaqua Real Estate | NAHB reports Home Builder Confidence Rises Four Points in October

Home Builder Confidence Rises Four Points in October

October 18, 2011 – Builder confidence in the market for newly built, single-family homes rose four points to 18 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for October, which was released today. This is the largest one-month gain the index has seen since the home buyer tax credit program helped spur the market in April of 2010.

“Builder confidence regained some ground in October due to modest improvements in buyer interest in select markets where economic recovery is starting to take hold and where foreclosure activity has remained comparatively subdued,” said NAHB Chairman Bob Nielsen, a home builder from Reno, Nev. “That said, confidence remains quite low as builders continue to confront overly restrictive lending policies that are discouraging prospective buyers, problems with new-home appraisals and widespread uncertainty regarding federal support for homeownership.”

“This latest boost in builder confidence is a good sign that some pockets of recovery are starting to emerge across the country as extremely favorable interest rates and prices catch consumers’ attention,” said NAHB Chief Economist David Crowe. “However, it’s worth noting that while some builders have shifted their assessment of market conditions from ‘poor’ to ‘fair,’ relatively few have shifted their assessments from ‘fair’ to ‘good.’ One reason is that builders are facing downward pricing pressures from foreclosed homes at the same time that building materials costs are rising, and this is further squeezing already tight margins.”

Derived from a monthly survey that NAHB has been conducting for more than 20 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores from each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

Each of the HMI’s three component indexes recorded substantial gains in October. The component gauging current sales conditions rose four points to 18, the component gauging sales expectations in the next six months rose seven points to 24, and the component gauging traffic of prospective buyers rose three points to 14.

Regionally, the West led all other areas of the country with its nine-point gain to 21 – the highest HMI score for that region since August of 2007. The Midwest and South each recorded four-point gains, to 15 and 19, respectively, while the Northeast held unchanged at 15.

Editor’s Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be found at www.nahb.org/hmi. More information on housing statistics is also available at www.housingeconomics.com.

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Armonk Real Estate | NAHB Reports Housing Starts Up 15%

Housing Starts Rise 15 Percent in September

October 19, 2011 – Nationwide housing starts rose 15 percent to a seasonally adjusted annual rate of 658,000 units in September, marking the strongest pace of residential construction since April of 2010, according to figures released by the U.S. Commerce Department today. The gain was largely attributed to a sharp increase on the multifamily side, which has been trending upward due to increased demand for rental apartments.

“Today’s numbers are very welcome evidence that builders are putting some crews back to work on single-family homes in select markets where economic conditions are improving, and on multifamily homes in places where demand for rentals is on the rise,” said Bob Nielsen, chairman of the National Association of Home Builders (NAHB) and a home builder from Reno, Nev. “That said, extremely tight lending conditions for both building and buying new homes, along with stubbornly high foreclosures that are putting downward pressure on home prices, continue to weigh down new construction and corresponding job growth.” He noted that for every one new single-family home built in this country, three new full-time jobs are created.

“The big gain in multifamily housing production for September was in the wake of a below-trend number in August and in keeping with characteristic volatility in that sector,” said NAHB Chief Economist David Crowe. “However, there’s no doubt that demand for apartments is rising as restrictive mortgage lending policies and concerns about future employment push consumers to pursue rental options.” Meanwhile, Crowe said, “Single-family starts showed a slight uptick for the month, which was right in line with our forecast for the third quarter and in keeping with what builders have been telling us in recent surveys regarding the emergence of improving conditions in select local housing markets.”

Single-family housing starts rose 1.7 percent to a seasonally adjusted annual rate of 425,000 units in September, regaining much of the ground they lost in August. Meanwhile, multifamily starts, which often display substantial swings from month to month, rose 51.3 percent to a seasonally adjusted annual rate of 233,000 units, their highest level since October of 2008.

Regionally, starts rose across the board in September, with a 12.7 percent gain in the Northeast, a 9.3 percent gain in the Midwest, a 15.7 percent gain in the South and an 18.1 percent gain in the West.

Building permits, which can be an indicator of future building activity, fell 5.0 percent to a seasonally adjusted annual rate of 594,000 units in September following a big gain in the previous month. Single-family permits held virtually unchanged at 417,000 units while multifamily permits declined 14.5 percent to 177,000 units.

On a regional basis, permit activity was mixed in September, with gains of 4.9 percent and 0.9 percent recorded in the Northeast and Midwest, respectively, and declines of 7.0 percent and 9.0 percent registered in the South and West, respectively.


Poll: Where is Bedford’s Best Pizza? – Bedford-Katonah, NY Patch | Bedford Hills Real Estate

There are some things in life over which people draw lines in the sand.

Sports teams. Religion. Political affiliation. Pizza.

Do you like thick crust or thin? Pepperoni or prosciutto? Piled with toppings or plain cheese?

As the nation celebrates National Pizza Month (didn’t you know?) we’re dedicating today’s lunch poll to the yummy gooey stuff.

There’s no shortage of pizzerias in Bedford’s three hamlets—and a few worthy of an extra few minutes in the car. We included a few nearby, but let us know if we forgot one!

We know you’ve got an opinion. Cast your vote and feel free to elaborate in the comments.