The commercial real estate arena in New York City has been interesting over the past few months. There are still pockets of growth, but they are not even across all sectors. A call to revise the City Charter could potentially streamline developments and open up opportunities, but getting the greenlight for such a change seems to be the biggest battle. All of this leaves CRE investors performing risk-assessments to figure out the best strategies moving forward.
Property Investment and Repositioning for the Risk-Averse
Currently, housing is a major focus at all levels of commercial real estate in New York. While new York CRE markets were bullish on new construction for higher-end apartments, the outlook has tempered a bit. Instead of new acquisitions, investors are looking to renovate or reposition existing assets to increase revenue from tenants. This means finishing repairs on properties that were previously being prepared for sale. Middle-market apartments are being overhauled to attract more upscale clientele. The new strategy is to use what you have to maximize revenue.
Value-Adds Are Big
One strategy that hasn’t lost momentum in NYC is value-adds on existing properties of all types. Apartments, office space, entertainment venues, and more are receiving additions that allows property owners to increase rent for tenants while giving something in return. Apartment buildings with a separate floor for shared office space, offices with cafes or gyms – implementing value-adds attracts tenants who are willing to pay a little extra for something more than just four walls and a roof. As the year progresses, NYC investors are certain to get even more creative to set their properties apart from the others to increase their bottom line.
Industrial and Logistics
The one CRE pocket that is showing steady growth and increasing yields with relatively low risk is in the industrial sector. Industrial properties, as well as those that can be utilized by logistics companies, are still on an upward trajectory in and around NYC. The versatility offered to tenants, combined with the low maintenance on the part of property owners and long-term leasing agreements, make industrial properties very attractive, even to new commercial real estate investors.
At Express Capital Financing, we provide solutions to NYC commercial real estate investors. From implementing value-adds and repositioning existing assets, to making new acquisitions to increase your bottom line, we can help. Contact Express Capital Financing today to learn more about our funding solutions for NYC property markets.
