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Building Success: An EisnerAmper Real Estate Blog

Weissenberg Quoted in The Commercial Observer

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November 25, 2014

Weissenberg_KenThe rise of foreign investment in the New York real estate marketplace is a topic we’ve covered before. While the sale of the Waldorf Astoria has been in the news recently, New York City’s status as a gateway city to the U.S. market has drawn in international dollars for decades. Investors from other countries, looking for a safe and stable place to invest their money, have locked in on cities such as New York as a wise investment. Recently, our Ken Weissenberg was quoted in the Accounting Issue of The Commercial Observer. Ken shared his perspectives on the flow of money into the New York and U.S. real estate markets, as well as the tax issues these investors face.

From the article:

“China’s the big winner in terms of leading foreign investment lately in New York City,” said Kenneth Weissenberg, a tax partner and co-chair of the Real Estate Services Group at EisnerAmper. “The central government in China I think is encouraging Chinese firms to invest overseas. The United States is a very stable environment, has strong currency, a strong real estate market and compared to prices in the rest of the world, what we consider expensive is a bargain.”

The article discusses where the money is coming from, including China, Canada and Norway. While China is one of the most active countries with recent transactions, Canada is actually the top investor in United States properties in all categories, with Norway coming in second. The experts quoted in The Commercial Observer article also felt that international investment in the New York City real estate market will not be slowing down any time soon. This hot market will continue to be hot well into the future. View the article: NYC Real Estate is Still the Safest Bet for Foreign Investors.  

Market Forecast Highlights Changing Retail Trends, Explosion of Commercial and Residential Development in Manhattan

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November 14, 2015

By Greg Kubikowski, CPA

Kubikowski_GregAt the recent EisnerAmper Real Estate Private Equity Summit , the first panel of the day gave attendees an updated forecast for private equity real estate funds. Panelists shared some of the trends that are re-shaping the market:

  • A tremendous wave of capital is flowing into New York, which fits with its status as a premier market. Everyone wants to live in Manhattan or London, so residential development is becoming vogue.  The high-end condo market, for example, is very hot in New York and specifically in Manhattan. 
  • Commercial development continues to explode, especially from Hudson Yards to Lower Manhattan. The panel cautioned though that on the retail side, people are grossly underestimating the impact of e-commerce. E-commerce is disrupting the traditional distribution model, meaning that there will be fewer and fewer bricks-and-mortar operations needed. With the demographic shift, and younger generations’ embrace of all things technological, traditional retail will be decimated.

The trends seen in New York are being seen across the country, so the message applies beyond the five boroughs. One thing is more certain than ever in every market: It will be even more critical for developers and businesses to be able to anticipate and quickly respond to these shifting needs in the future.

Top Trends in the Manhattan Multifamily Market

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November 7, 2014

By Michael Benison, CPA, MST

We caught up with Peter Von Der Ahe, Senior VP of Investments at Marcus & Millichap, to get his insights on the market. Peter specializes in the Manhattan multifamily niche, and sees a number of trends changing the marketplace:

  • 2013 was a big year for transactions, with a lot of capital invested in the marketplace. 2014 will be one of the biggest years in terms of volume, as we have seen an increase in raised funds from a greater variety of sources. “Activity creates more activity,” as they say, and more money will continue to be raised. 
  • There are diverse sources of funding available from foreign investors, families and institutions from around the globe. It’s important to note that foreign investors have different objectives than domestic investors. Domestic investors desire capital return, while foreign investors may have additional investment objectives.
  • The multifamily market is the ideal sector to be working in because it has had consistent performance over the last few years. If the economy starts to decline, more investments will aggregate towards multifamily units.
  • There hasn’t been a dramatic increase in prices in comparison to the 2012 and 2013 levels. Interest rates are at all-time lows and prices are on the high side. Since there isn’t nearly enough supply of multifamily units in Manhattan, demand isn’t waning at all. 
  • Now is a great time to make moves in the market. For investors who are not selling or refinancing, now is a perfect opportunity to make a lateral move by trading to a better location or higher quality asset. Prices might be high, but there are significant investment opportunities.
  • 1031 Exchanges are very popular in the marketplace, as many new deals are being structured as 1031 transactions. However, there is the possibility that 1031 legislation will be removed at the end of the year. If this occurs, there will be a decreased number of asset sales as the deals become more expensive.
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