Multifamily market picks up in Q3 — but still down from last year

Two multifamily deals above $100 million have catapulted the third quarter of 2017 back to the strongest quarter of the year, according to a new report from Ariel Property Advisors.

After a sluggish first and second quarter, the dollar volume for the city’s multifamily market hit $2.2 billion, a 14 percent increase over the second quarter, but a 24 percent drop year-over-year. Compared with the second quarter, the number of buildings traded slipped 32 percent, and the number of deals jumped 4 percent.

Manhattan led the quarter with $1 billion in dollar volume, driven by the two supra-$100 million deals, which included the $320 million sale of the 320-unit Vogue at 990 Sixth Avenue. In terms of pricing, Manhattan was the only market where the average price per square foot dropped, from $961 to $934, though the average price per unit increased by more than $300.

Northern Manhattan was the only submarket where dollar volume exceeded last year’s third quarter, a dollar volume of $365 million across 24 transactions.

The Bronx also saw 24 deals for a total of $250 million. Half of the deals were under $5 million, and four were portfolio deals, including an eight-building portfolio sold by Paradise Management for $35 million.

Brooklyn’s dollar volume dropped relative to both last quarter and last year, with a total of $444 million across 36 transactions. Pricing in Brooklyn was mixed as well, with price per square foot increasing but price per unit decreasing from $328,010 to $310,864.

Meanwhile, Queens registered its worst quarter since 2011 in terms of deal volume, and dropped below $100 million in dollar volume for the first time since 2014.

Pricing is based on a six-month trailing average, according to the report.