Yesterday I spent the day at a the New York City Real Estate Expo, where some pretty big hitters in the industry came out to chat. (Think Robert Knackal, Paul Massey, Jr. etc.) It was a fantastic event that examined some real issues in the business lately, and dispelled a few misconceptions.
1. Since the Lehman Brothers crash in 2008, it seems that, as an asset class, multi- family homes in New York City have performed very well. If you have a few million burning a hole in your pocket (starting at $3 to $5 million) buying a whole building is a very good idea, especially if you are looking to preserve wealth for future generations. This was an idea that came up at several talks that I went to.
2. Few people seemed excited about retail spaces, mostly because the economic indicators haven't been faring well for retail this year.
3. While condos are selling well in Manhattan, the glass and steel new developments are having a hard time. Why? Apparently, it's psychological. Those new buildings are a symbol of the go-go years, and there is a mentality among buyers that they are overpriced. Sure, they sell, but a few developers on a the panels talked about having to offer incentives to buyers (paying closing costs, etc.) in order to unload units.
4. If you feel like taking over a half-built project, which is not for the faint of heart, a visit to the Department of Buildings should be your first stop. I sat in on a very funny talk with a developer who knew of banks who owned properties and were trying to sell them, but didn't have the building file and had never even seen the property.
