Due to the anticipated increase in household formation from an improving economy, multifamily housing is the one commercial real estate sector that is expected to perform well in 2011. Multifamily vacancy rents are predicted to decline and rents are expected to increase 1.4 percent-particularly in the major metro areas. The New York City Multifamily housing market is expected to do well both in the short and long terms. Rising employment levels coupled with continued growth in hospitality and retail trade sectors will further strengthen the basis for recovery in our City.
Consequently, Manhattan is expected to see an increase in rent growth in the 6 percent range. The Bronx has experienced building activity due to its tight housing market and it affordability as compared to the other boroughs. It has seen an increase in effective rents of 3.4 percent and promises to continue to maintain low vacancy levels in 2011. Northern Brooklyn, a historically strong renters’ market, is anticipated to see a resurgence in rent growth. Other markets in Brooklyn, however, such as Bedford-Stuyvesant, Crown Heights and Bushwick are expected to experience a slower pace of growth. In the largest borough, the Queens Multifamily housing market is expected to benefit from job growth as well and is anticipated to see a 2.8 percent increase in revenues.
[Data Sources: NAR, Commercial Real Estate, Quarterly Market Report, November 29, 2010; and Marcus and Millichap, Fourth Quarter 2010, Apartment Research Market Update.]
For Multifamily Property Offerings that Meet Your Purchase Criteria, Contact Marti O’Hare at mohare@frandimapropertiesllc.com.
