NEW YORK, NY – October 23, 2023 – New York City recorded $1.55 billion in multifamily sales in Q3 2023, a 56% decline from the second quarter, according to Ariel Property Advisors’ Q3 2023 Multifamily Quarter In Review New York City. Transaction volume also fell by 24% to 227 quarter-over-quarter.

Free market and 421a buildings accounted for 81% of the total dollar volume, with rent stabilized buildings capturing 16% and affordable housing accounting for 4%, substantially lower than the sector’s second quarter market share of 43%, which included several large transactions including Omni’s 5,900-unit portfolio sale to Nuveen for close to $1 billion.

“In the third quarter, higher interest rates and mortgage maturities continued to disrupt the market at a time when regional and larger financial institutions are pulling back,” said Shimon Shkury, President and Founder of Ariel Property Advisors. “However, the FDIC is in the process of marketing Signature Bank's substantial multifamily loan portfolio, which increases the likelihood of much higher activity in the sector in the coming months.”

Submarket Highlights:

      • Manhattan. Manhattan saw $743 million in multifamily dollar volume across 33 transactions, declines of 45% and 47%, respectively, from Q2 2023. Significant trades included two free market and 421a buildings: Pacific Urban Residential’s acquisition of the residential condo portion of a 213-unit elevator building at 130 W 15th Street for $183 million, and NYU Langone’s acquisition of 377 E 33rd Street for $210 million. NYU plans to use the building for housing for university staff.

      • Brooklyn. Multifamily sales declined quarter-over-quarter by 31% to $531 million but transaction volume fell a modest 4% to 126. Over half the dollar volume and 83% of the transactions in Brooklyn were for small MF-MU buildings with under 10 units, indicating investor demand for tax class 2A and 2B buildings. The two largest transactions in the borough included the Carlyle Group’s acquisition of the 123-unit, newly constructed 416 Metropolitan Ave for $97.5 million, and the purchase of two residential towers totaling 66,000 square feet at 100 Steuben St & 531 Myrtle Ave by Ben-Josef Group Holdings for $40 million, a significant discount from the $55 million the seller, UBS Realty Properties, paid in 2020.

      • Northern Manhattan. Multifamily dollar volume in Northern Manhattan totaled $98 million across nine transactions, with rent stabilized buildings accounting for 72% of the dollar volume and 50% of the transaction volume for the quarter. Significant transactions included the 313,938 gross square foot BRM Inwood MF Portfolio, which sold for $38 million, and 132,791 gross square foot 92 Pinehurst Avenue & 4 S Pinehurst Avenue, which traded for $18 million.

      • The Bronx. Multifamily sales in the Bronx totaled $90 million, a 90% drop from Q2 2023 when Nuveen’s acquisition of the Omni affordable housing portfolio accounted for $593 million of the borough’s sales. The largest transaction was a 160,000 SF, 12-story affordable multifamily and commercial property at 950 Westchester Avenue, which sold for $19.1 million, and the sale of 2009 Cruger Avenue, a 49,260 SF building, which traded for $6.2 million.

      • Queens. Multifamily dollar volume in Queens totaled $88 million, a 65% decline from the second quarter, also due to Nuveen’s second quarter acquisition, which made up $91 million of the borough’s total in Q2 2023. Significant transactions in Q3 2023 included 100,260 SF property at 94-05/95-05/94-19 35th Avenue that traded for $14.5 million, and a 22,155 SF mixed use property at 25-34 Steinway Street that sold for $9.15 million.

For more information and to read the full report, please click here.