Things are looking good for the owners of New York’s commercial skyscrapers.
An improving economy and increasing demand from foreign investors have brought Manhattan’s office-building values back to where they were before the crash.
According to Green Street Advisors, the index of midtown values was at 99.4 in June, up from 87.2 a year earlier. The index reached its peek in 2007 — hitting 100. Its lowest point? In April 2009, when the index sunk to 45.5.
While this boom has increased tax revenue for the city, some industry watchers are asking how long it will last. Experts have pointed out that rising property values have mostly been driven by historically low interest rates, not by escalating rents or occupancies.
Some examples of major recent sales include the $173 million sale of 80 Broad Street. Real estate private equity firm Savanna bought the property in 2011 for $48.3 million. Earlier this week, Harbor Group International LLC sold its property at 1412 Broadway to a group led by Isaac Chetrit for $250 million, $100 million more than what Harbor paid for it in 2010. [WSJ] – Claire Moses