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NEW YORK CITY-”The appetite of institutional investors for housing product has been growing at an extraordinary rate,” notes Richard Bassuk, president of the Singer & Bassuk Organization, which handled a number of Liberty Bond transactions for Lower Manhattan condominium conversions including 63 Wall St. and 17 Battery Pl. “It’s been a year of rapidly escalating land prices and rapidly escalating construction prices. The situation has lead to an acceleration of condo conversions in Manhattan because of the economics and a reduction in the amount of rental housing.”

However, in the last 30 days a number of developers have approached SBO about potential rental housing projects “West of Sixth Avenue,” Bassuk says. “It’s a supply-and-demand issue.” And various incentive programs will go toward increasing the city’s affordable housing product. Earlier in the year, the city introduced the New Ventures Incentive Program Over a five-year period, New VIP will provide up to $200 million for acquisition and pre-development costs to encourage residential development in derelict manufacturing areas, particularly brownfields, appropriate for rezoning for residential use.

According to the latest figures from Marcus & Millichap, Manhattan apartment vacancies were expected to fall to 3.9% by year end, from 4.7% in 2003. Asking rents increased 1.7% to $2,900 per month this year, while the median price of Manhattan apartments rose to approximately $126,000.

Infrastructure improvements are fueling neighborhood revitalization in various parts of the borough including Jamaica. The introduction of the Air Train–a transport system connecting the Jamaica station with John F. Kennedy Airport–is a impacting the Downtown Jamaica market, according to John D. Markunas of JFK Corporate Square. “The options in Jamaica are increasing.” Adding retail space is and community efforts are key in this revitalization effort.

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