Fears about the economy are hard to ignore, but one sector of commercial real estate appears poised to defy the uncertainty: New York City multifamily properties. Despite the recent volatility and uncertainty, NYC's multifamily market seems ready for a standout year.
JLL brokers Rob Hinckley and Jeff Julien forecast that multifamily sales volume in New York City will reach an impressive $10 billion this year, surpassing the combined totals of the previous two years.
"We've already closed about $800 to $900 million of sales this year on the local housing side," Hinckley told GlobeSt. "So it's tracking to be probably a record year. It has felt like we're back to an extraordinarily robust multi-housing transaction market." This strong start is attributed to investors eager to deploy sidelined capital and property owners who are now ready to sell after holding off during more uncertain times.
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Brooklyn dominated NYC's multifamily market in 2024, according to Ariel Property Advisors' report, generating $3.48 billion in sales—a 59% year-over-year surge that outpaced Manhattan below 96th Street, which recorded $3.44 billion.
Hinckley explained that Brooklyn's rise was fueled by new developments and merchant builders needing to recycle capital for future projects. However, he anticipates Manhattan will reclaim its dominance in 2025, driven by large-scale single-asset sales and high-value portfolios coming to market. "We know that there are several large conversions that are stabilizing, that are going to be sold," he said. "There are a couple billion-dollar portfolios that are likely to come out."
Two distinct strategies are shaping investor interest this year: acquiring older assets for renovation and value enhancement or targeting new Class A towers. Despite stock market volatility, Hinckley has not observed any slowdown in NYC multifamily transactions.
He highlighted a recent example of JLL facilitating a $240 million local sale involving a major investment advisor, noting that economic turbulence hasn’t derailed such deals.
While concerns about the broader economy linger, they have yet to significantly impact NYC’s multifamily sector. Hinckley noted that buyers remain confident and sellers see lowered interest rates as an opportunity for higher valuations. "The truth is, the market doesn't move that fast," he said. "Certainly sellers don't do that when it goes the opposite way."
Though uncertainties remain—such as tariff policies—Hinckley expressed optimism about what lies ahead for NYC multifamily in 2025. For now, it seems this corner of commercial real estate is well-positioned to thrive amidst broader economic challenges.
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