Sales of large development sites in prime areas of Manhattan grew five-fold between 2009 and 2011, according to Massey Knakal Realty Services data cited by Crain’s, but market conditions still remain vastly different from the pre-crash era.
There were 51 sales of sites larger than 10,000 square feet south of Harlem in 2011, and 142 sales of development parcels in the four boroughs outside of Staten Island. The four-borough sales are twice what they were two years ago and represent a 38 percent price increase per square foot over that period to $173.22.
But despite those improving figures, glaring weaknesses linger in the commercial market. The total number of large development site sales in Manhattan still sits below the 75 to 80 dealt in a typical year, and prices in the borough tumbled 17 percent in the last two years to $311.22 per square foot.
And the biggest difference in post-crash development deals might be the type of buyer. Whereas buyers needed little equity or experience to secure financing during the boom, today’s developers typically bring a long track record and half of the required money to the table. [Crain’s]