Thank you for sharing!

Your article was successfully shared with the contacts you provided.

NEW YORK CITY- Real estate investors looking for a profitable place to park their money could do no better than selecting New York City real property according to a new report by PricewaterhouseCoopers and Lend Lease. While predicting that real estate investment prospects for all major metropolitan areas will decline next year, Emerging Trends in Real Estate 2000 ranks the New York market as the most attractive area for the first time in more than a decade.

Three major reasons are cited for New York’s rise to the top of the study’s charts, according to Peter F. Korpacz, director of the global strategic real estate research group at PwC. First among the reasons is supply constraints. “There’s not a lot of land left to develop,” Korpacz says. The New York market is strong now because of its success in the late 1990s, which saw rents rise significantly and generated high occupancy rates.

Needless to say, there is another reason for the change in ranking. The destruction of 13 million sf of Downtown office space on Sept. 11 makes an already supply-constrained market even more heavily weighed toward the demand side, according to the report, further enhancing the strength of the New York market as an attractive investment opportunity in the coming year. “Considerable upside exists in most buildings to write old leases up to market at rollover,” the report states.

Pension funds will be a significant player in the real estate market going forward as they look to sell some real estate properties and use the proceeds to buy stocks, the director continues. This will put some pressure on the market, but “there won’t be any fire sales.” Real estate won’t see high levels of foreclosures and bankruptcies because interest rates are low and volatility among ownership should be lessened because of the new disciplines enforced by lenders since the early 1990s, he says.

The other locales ranked behind New York are: Washington, DC; Boston; Southern California; Chicago; San Francisco; Seattle; Miami; Denver; and Philadelphia.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper



Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt
Live Chat

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.