Daily market intelligence on mortgages, equity raising, investment sales, and CMBS.

Wednesday, 12 February 2020

New York City Apartment Sales Decline 40 Percent to $6.9Bln in 2019

Multifamily investment-sales volume in New York City declined by 40 percent last year to $6.9 billion, according to Ariel Property Advisors. The New York investment-sales and research firm attributed the sharp decrease to a state law, passed last year, that put greater restrictions on the ability of landlords to increase rents at certain properties.

Commercial Real Estate Direct Staff Report

Multifamily investment-sales volume in New York City declined by 40 percent last year to $6.9 billion, according to Ariel Property Advisors.

The New York investment-sales and research firm attributed the sharp decrease to a state law, passed last year, that put greater restrictions on the ability of landlords to increase rents at certain properties.

Last year's sales volume was the lowest total since 2011, when $5.3 billion of deals took place. Ariel said 290 deals occurred last year, down 36 percent from the year before and the lowest number since it started tracking the data in 2010.

"It's a direct result of the new rent guidelines," said Shimon Shkury, a former partner at Massey Knakal Realty Services, who founded Ariel in 2010.

The law, the Housing Stability and Tenant Protection Act of 2019, repealed a provision that had allowed landlords to remove units from the rent-stabilization rolls when their monthly rent topped $2,733.75, or if the tenant earned at least $200,000 annually for two consecutive years. It also voided a provision that had allowed landlords to increase rents for rent-stabilized units by up to 20 percent when a unit became vacant. It also limited rent increases for rent-stabilized units that resulted from improvements made to a property's roof, boiler or other equipment to only 2 percent from the previous 6 percent.

Units that are subject to the city's rent-control and rent-stabilization rules accounted for 45.3 percent of the 2.2 million units in the city at the end of 2017, according to the U.S. Census Bureau.

The law did not have much of an impact on the rent-controlled units in the city, which totaled 21,751 as of the end of 2017. Rent-controlled units are those in which tenants or their family members have lived since before July 1, 1971 and applies only to buildings constructed before February 1947. Those are subject to strict rules that limit rent increases to 7.5 percent every two years and restrict evictions. Tenants in rent-controlled units do not technically have leases because they can live there for as long as they are alive. If a tenant at a rent-controlled apartment dies, a family member has the right to a renewal lease if he or she lived with the tenant for the past two years. When rent-controlled units become vacant, they shift onto the rolls of rent-stabilization.

Meanwhile, there were 966,442...





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Data Digest

 

CMBS DELINQUENCY VOLUME

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CMBS SPECIAL SERVICING VOLUME

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Top Bookrunners Domestic, Private-Label CMBS - 2017
Investment Bank #Deals Vol$mln MktShr%
Goldman Sachs 17.59 11,819.34 13.68
JPMorgan Securities 14.52 10,968.11 12.70
Citigroup 12.04 10,012.71 11.59
Wells Fargo Securities 14.02 9,936.06 11.50
Deutsche Bank 12.55 9,879.74 11.44

 

RCA CPPI

 

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CMBS 2.0 Spreads

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Top CMBS Loan Contributors - 2017
Lender #Loans Vol$mln MktShr%
Goldman Sachs 146.89 11,719.34 13.63
JPMorgan Chase Bank 117.68 10,114.14 11.76
Deutsche Bank 198.48 9,689.97 11.27
Morgan Stanley 166.18 8,539.78 9.93
Citigroup 199.05 8,088.24 9.41

 

 

 

REITCafe

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