Manhattan Apartment Market Strong in Weak Market

NEW YORK CITY-Despite serious post-Sept. 11 concerns regarding Manhattan’s multifamily sector, the apartment market has shown short-term resiliency and its long-term outlook remains strong, according to a new report by Marcus & Millichap Real Estate Investment Brokerage Co.

“After the tragic events of last September, there was tremendous concern about the magnitude of potential negative effects on New York’s business and real estate sectors,” comments Mitchell R. LaBar, senior vice president and regional manager of the firm’s Manhattan office. “While aftereffects certainly have occurred, they are generally not as severe as feared. The local economy continues to struggle, but this is largely due to the national economic slowdown and downward trends in the financial and technology sectors that can be traced to well before last fall. Overall, the apartment market has rebounded to rent and occupancy levels experienced last summer, and the local outlook is quite positive.”

The report goes on to state that buyer demand for New York City apartments remains strong. Investor demand will help push up prices slightly this year, unless there is a significant increase in interest rates, the study predicts. Moreover, if rates do increase, it could help motivate more sellers and increase the inventory of apartment investment property on the market.