Manhattan’s property sales banked 60 transactions in the second quarter, which totaled $2.4 billion, representing a 13 percent boost from the first quarter or 20 percent year-over-year, according to a report from Avison Young.
But not every sector performed well. For example, the development market experienced a quarter-over-quarter 56 percent drop in the number of sales and a five percent dip in average price, which was $440 per square foot. Transactions increased by 36 percent to $280 million.
The retail sector was a little bit more mixed, which posted just $261 million in volume, a 79 plunge from the first quarter. The amount of sales did not change, while the average price shot up to $1,770 per square foot, a 71% boost from the previous quarter.
Office & office condos saw volume skyrocket by 363 percent to $873 million, while sales went up by 25 percent. However, the average price crashed by 41 percent to $388. The top three biggest transactions in the segment occurred on 980 Madison Avenue, 780 Third Avenue, and 148 Madison Avenue.
Multifamily and mixed-use enjoyed gains from the number of sales (45 percent increase) and average cap rate (up 52 basis points). But the average price fell to $555, down 8 percent, while total dollar volume rose by 32 percent to $706 million.
Going forward, Avison Young is keeping a few things in mind, which can determine future CRE performance in Manhattan. One of them is what a potential impact a rate cut by the Federal Reserve might have. Another is tax incentives including 485-x and 467-m, and if they will alter willingness to spend.
While questions remain, the general idea is that “the Manhattan investment sales market has built some momentum going into the second half of 2024,” Avison Young said.