Residential market report

BHS balks at sale rumors

Brown Harris Stevens isn’t going anywhere. That’s what a late-May missive from CEO Bess Freedman and President Hall Willkie told 1,000 or so agents amid chatter that parent company Terra Holdings could sell the 146-year-old firm to Compass. BHS, one of the few remaining independent brokerage firms in New York City following Compass’ acquisition of Stribling & Associates, attempted to dispel the buzz by blasting the rumors as sparked by a rival seeking to sow uncertainty. While Freedman and Willkie stopped short of naming Compass, the duo said the scuttlebutt was being “purposely spread by a competitor to further support their unethical recruitment tactics… that issue is being addressed legally,” according to an email obtained by The Real Deal. Sources said that in recent weeks Compass has stepped up its efforts to recruit BHS agents by urging them to join its ranks before BHS is acquired. Freedman told TRD she wanted to address the matter head-on to reiterate that the firm is not for sale. Compass said in a statement that it values its relationships with other firms. — E.B. Solomont

Big Apple still No. 1 for billionaires

While the number of billionaires around the world shrank 5.4 percent in 2018, to 2,604, New York can still lay claim to being home to the most, at 105, according to a new report from research firm Wealth-X. Hong Kong (87), San Francisco (75) and Los Angeles (39) trailed behind the city in the billionaire ranks, whose collective masses saw their total net worth dip 7 percent last year, to $8.6 trillion, due to market volatility and global trade uncertainties. A shrinking number of Chinese billionaires — Wealth-X said their ranks plummeted 13 percent last year, to 677 — has hit New York’s housing market hard as potential foreign buyers retreat. “The Chinese buyer is basically on hold now until a U.S.-China trade deal is struck,” Compass’ Leonard Steinberg told TRD. The city’s ultraluxury market, defined as the top 20 percent of sales, is down 4.7 percent from a year ago, according to StreetEasy. And while billionaire homebuyers are a small subsection of the market, more than 40 percent of roughly 900 units in eight buildings along Manhattan’s Billionaires’ Row remain unsold, according to a recent analysis from Miller Samuel.— E.B. Solomont

Cautious buyers push up Manhattan rents

A softer sales market has rental prices rising again in Manhattan, according to a Douglas Elliman report. Pricing in the borough continued an upward trend as the share of new leases with incentives fell to 36.9 percent in April, down from 44.3 percent a year earlier. At the same time, the median net effective price rose 4.4 percent, to $3,379. “It’s more and more clear how the weakness of the sales market continues to resuscitate and press rental prices up,” said Jonathan Miller, author of the report and CEO of appraisal firm Miller Samuel. Sales volume for new development properties tumbled 39.4 percent in the first quarter, while the overall number of sales closed in those three months dipped 2.7 percent when compared to the same time a year ago. Meanwhile, the top of Manhattan’s rental market has steadied. In the luxury segment, the median rental price rose 2.6 percent year over year, to $8,200, as the entry threshold climbed 3.9 percent, to $6,495. A separate Citi Habitats report noted that Manhattan’s lowest rents were in Washington Heights, which had a median rent of $2,350 in April. — Meenal Vamburkar

Brooklyn, Queens rents rise as concessions fall

Another Elliman report found that seasonal demand and softer sales are bolstering rents in Brooklyn and Queens. Both outer boroughs are benefiting from a decline in incentives heading into the busy summer season, as well as a continuing softness in the sales market. In Brooklyn, new leases rose 7.2 percent in April, the fourth time they have risen year over year in the last five months. The median net effective rental price rose 2.8 percent, to $2,762. Miller Samuel’s Miller, author of the market analysis, said it’s “the same pattern we’re seeing in Manhattan. It’s not quite the same price growth, but we’re seeing growth.” The market share for concessions in Brooklyn fell to 38.1 percent from 51 percent a year earlier. In Queens, concessions fell to 45.3 percent from 65.1 percent in April 2018, while the median net effective rent rose 3.2 percent, to $2,731. A separate report from Citi Habitats noted that Dumbo was the most expensive neighborhood in Brooklyn, with a median rent of $4,575, followed by Downtown Brooklyn at $3,695. Bedford-Stuyvesant was the least expensive, at $2,500. — Meenal Vamburkar