NYC Multifamily Sales Market Overview

NEW YORK CITY MULTI-FAMILYSALES MARKET OVERVIEWROBERT A. KNAKAL

Source: Massey Knakal Realty Services

NYC Investment Property Sales Volume (1984-2010)

VOLUME OF SALES



VOLUME OF SALES



VOLUME OF SALES

TURNOVER RATES(ANNUALIZED)

BUILDING SALES VOLUME(NUMBER OF BUILDINGS SOLD)

2005 – 1H 2010, MANHATTAN

BUILDING SALES VOLUME(NUMBER OF BUILDINGS SOLD)

2005 – 1H 2010, CITYWIDE

CITYWIDE DOLLAR VOLUME(AGGREGATE SALES PRICE)

2005 – 1H 2010, ALL SALES (IN BILLIONS)

MANHATTAN DOLLAR VOLUME(AGGREGATE SALES PRICE)

2005 – 1H 2010, ALL SALES (IN BILLIONS)

AVERAGE PPSFMANHATTAN – FROM PEAK TO 2009

-32%

AVERAGE PPSF

MANHATTAN

PP

SF

AVERAGE CAP RATES

MANHATTAN

CA

P R

AT

E

CAP RATES

Source: Massey Knakal Realty Services, Miller Cicero (2003-2008)

MANHATTAN APARTMENT BUILDINGS (1984-2010)

WALK-UP CAP RATESCOMPARED TO GRM


MANHATTAN WALK-UP APARTMENT BUILDINGS (1984-2010)

ELEVATOR CAP RATESCOMPARED TO GRM


MANHATTAN ELEVATOR APARTMENT BUILDINGS (1984-2010)

CAP RATESCOMPARED TO MORTGAGE RATES

Source: Massey Knakal Realty Services, Miller Cicero (2003-2008), Federal Reserve Bank


LEVERAGE(CAP RATES MINUS MORTGAGE RATES)



CAP RATESCOMPARED TO 10-YEAR T-BILL

Source: Massey Knakal Realty Services, Miller Cicero (2003-2008), US Treasury


RISK PREMIUM(CAP RATES MINUS 10-YEAR T-BILL)



APARTMENT BUILDINGSWALK-UP and ELEVATOR SALES


*annualized

# Buildings # Units $ Volume2009 435 9,888 1,264,841,119$ 1H10 304 8,701 1,589,335,058$

CHANGE* +40% +76% +151%

APARTMENT BUILDINGSWALK-UP SALES


2009

1H 2010

# Buildings # Units $ VolumeManhattan 77 1,064 236,428,208$

Northern Manhattan 38 918 83,160,552$ Bronx 53 1,422 100,076,847$

Brooklyn 123 1,205 151,710,737$ Queens 57 413 66,455,375$

TOTAL MARKET 348 5,022 637,831,719$

# Buildings # Units $ VolumeManhattan 34 403 147,660,014$

Northern Manhattan 38 857 77,697,684$ Bronx 37 905 63,282,937$

Brooklyn 85 688 190,349,073$ Queens 45 462 64,841,671$

TOTAL MARKET 239 3,315 543,831,379$

CHANGE* +37% +32% +71%

*annualized

APARTMENT BUILDINGSELEVATOR SALES


2009

1H 2010

*annualized

# Buildings # Units $ VolumeManhattan 11 643 224,675,000$

Northern Manhattan 22 931 116,208,000$ Bronx 31 1,881 139,407,500$

Brooklyn 18 905 91,926,400$ Queens 5 506 54,792,500$

TOTAL MARKET 87 4,866 627,009,400$

# Buildings # Units $ VolumeManhattan 12 1,517 635,454,000$

Northern Manhattan 18 1,934 222,636,067$ Bronx 17 1,185 85,868,612$

Brooklyn 13 556 74,935,000$ Queens 5 194 26,610,000$

TOTAL MARKET 65 5,386 1,045,503,679$

CHANGE* +49% +121% +233%

MULTIFAMILY ANALYSISCAP RATES


WALK-UP

ELEVATOR

2007 2009 2010Change from

2009Change from

2007

Manhattan 3.18% 4.71% 5.08% +37 +190

Northern Manhattan

5.11% 5.53% 6.01% +48 +90

Bronx 5.85% 7.84% 7.97% +13 +212

Brooklyn 5.27% 6.14% 6.26% +12 +99

Queens 5.32% 6.04% 6.56% +52 +124


2009Change from

2007

Manhattan 4.40% 5.46% 6.08% +62 +168

Northern Manhattan

5.43% 7.02% 7.26% +24 +183

Bronx 7.45% 7.51% 7.30% -21 -15

Brooklyn 5.91% 7.60% 7.09% -51 +118

Queens 6.45% 6.72% 7.20% +48 +75

MULTIFAMILY ANALYSISGRM


WALK-UP

ELEVATOR


2009Change from

2007

Manhattan 15.35 11.66 11.23 -0.43 -4.12

Northern Manhattan

11.45 8.25 7.70 -0.55 -3.75

Bronx 7.81 7.16 7.45 +0.29 -0.36

Brooklyn 10.12 9.42 9.92 +0.50 -0.20

Queens 11.21 9.93 9.62 -0.31 -1.59


2009Change from

2007

Manhattan 16.75 13.30 11.67 -1.63 -5.08

Northern Manhattan

12.54 8.47 8.90 +0.43 -3.64

Bronx 8.45 6.94 6.88 -0.06 -1.57

Brooklyn 10.96 8.78 8.64 -0.14 -2.32

Queens 12.13 9.14 9.56 +0.42 -2.57

MULTIFAMILY ANALYSISPRICE PER SQUARE FOOT


WALK-UP

ELEVATOR


2009Change from

2007

Manhattan $522 $434 $406 -6% -22%

Northern Manhattan

$170 $124 $109 -12% -36%

Bronx $85 $69 $59 -14% -31%

Brooklyn $110 $126 $196 +56% +78%

Queens $117 $133 $189 +42% +62%


2009Change from

2007

Manhattan $556 $505 $634 +26% +14%

Northern Manhattan

$307 $161 $128 -20% -58%

Bronx $108 $88 $96 +9% -11%

Brooklyn $188 $160 $181 +13% -4%

Queens $220 $190 $185 -3% -16%

MULTIFAMILY ANALYSISPRICE PER UNIT


WALK-UP

ELEVATOR

2009 2010Change from

2009

Manhattan $347,630 $387,900 +12%

Northern Manhattan

$115,780 $88,240 -24%

Bronx $73,522 $79,379 +8%

Brooklyn $131,574 $136,431 +4%

Queens $143,450 $137,552 -4%

2009 2010Change from

2009

Manhattan $355,181 $319,823 -10%

Northern Manhattan

$92,733 $114,782 +24%

Bronx $70,643 $66,262 -6%

Brooklyn $129,672 $145,908 +13%

Queens $108,383 $132,826 +23%

1. VOLUME – Continued Increases

3. FINANCING – Strong

MULTI-FAMILY MARKETCONCLUSIONS:

2. PRICES – Uncertain

THINGS TO KEEP AN EYE ON:

1. Unemployment

3. Housing Market

4. Inflation

5. Fed Monetary Policy

6. Deleveraging

2010 and BEYOND

2. Supply vs. Demand

Real Estate

NYC Multifamily Sales Market Overview