The total dollar amount of Manhattan assets classified as distressed has halved since 2008, Crain’s reported, a sign that the market is rebounding at a healthy pace.
Three years ago, $30.6 billion of assets in Manhattan was in foreclosure, bankruptcy or in the process of having its loans modified. The figure has dropped to $15.2 billion, and 30 percent of that dollar amount is tied to apartment complex Stuyvesant Town and Peter Cooper Village.
“This happened faster than we would have imagined,” said Dan Fasulo, managing director of Real Capital Analytics.
The drop in distressed properties can be attributed to an accumulation of single transactions, Crain’s said, and bigger landlords buying up distressed loans. Vornado Realty Trust, for example, bought up three of the eight large distressed assets sold in the first half of 2011, including a stake in 280 Park Avenue. There is also increased interest from investors in commercial real estate, with $13.9 billion in commercial properties selling in the borough last year, almost four times the amount sold in 2009.
Some Manhattan properties still run the risk of entering into distress. Crain’s estimated that $5 billion to $10 billion worth of real estate is close to falling into that category. [Crain’s]