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Miller Cicero’s New York City Income Property Market Report First Half 2007 Is Released

November 28, 2007 | 10:28 pm |

Our commercial advisory firm just released its New York City Income Property Market Report for the first half of 2007. My commercial valuation partner John Cicero put the report together. Its the only one of its kind available.

Here’s an excerpt:

The number of closed sales was up 11.3% in the first half of 2007 compared to the prior six month period, driven by the sales activity in Manhattan, including Northern Manhattan. Manhattan saw twice as many walk ups sold in the first six months of 2007 compared to the second half of 2006. Along with the increase in the number of sales, the median price of a Manhattan apartment building showed a sharp increase as well, breaking $500 per square foot for the first time. The median price of a walk-up apartment building in Northern Manhattan also set a record, exceeding $300 per square foot. The outer boroughs were mixed, however, as the price of walk-up apartment buildings in Brooklyn and Queens remained relatively flat, while Bronx saw a decline in price to $100 per square foot. The cap rates for walk-up apartment buildings, which comprise the greatest sample size, illustrated further compression in Manhattan, including Northern Manhattan, and generally remained flat in the Bronx, Brooklyn and Queens. Though the number of sales is up sharply from the second half of 2006, with 2,063 closed sales compared to 1,852, there were nonetheless 13% fewer sales than the first half of 2006, one year ago, which was the most active period of the past four years…

Massey Knakal will distribute over 300,000 hard copies of the report over the next few months.

Massey Knakal New York City Income Property Market Report [pdf]

Report Methodology [Miller Cicero]

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Miller Cicero’s New York City Income Property Market Report Second Half 2006 Is Released

May 17, 2007 | 7:04 pm |

Our commercial advisory firm just released its New York City Income Property Market Report for the second half 2006. My commercial valuation partner John Cicero put the report together. Its the only one of its kind available.

Here’s an excerpt:

The second half of 2006 saw a sharp drop in the number of income property sales, down 22% from the first half of the year. The greatest decline was in Manhattan (south of 96th Street), where the number of sales declined 44%. Northern Manhattan, Brooklyn, Queens and the Bronx each saw the number of sales decline from 17% to 21%. Though the drop in the number of sales was significant, the sales activity for all of 2006 was nonetheless 34% higher than in 2005, with 4,234 sales versus 3,148 sales, respectively. The market- wide turnover rate was 1.5% in the second half of 2006 (down from 1.9% the prior half) a total turnover rate of 3.4% for the year. This is in contrast to the second half 2005 turnover rate of 1.3%, and a total 2005 turnover of 2.5%…

Massey Knakal will distribute over 300,000 hard copies of the report over the next few months.

Massey Knakal New York City Income Property Market Report [pdf]

Report Methodology [Miller Cicero]

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Carnival Of Real Estate [Week of August 7, 2006]

August 7, 2006 | 11:15 am | Public |

[Matrix is hosting the Carnival of Real Estate the week of September 25, 2006. Its a great way to read some great posts on real estate topics of the day and not get sick on cotton candy.]

[What is a carnival](

[Here’s a great carnival Q & A]( Its basically a a bunch of blogs that take turns displaying the favorite posts of the group each week. Carnivals can vary by topics and of course and the most relevant to Matrix readers is the Carnival of Real Estate.

This week’s host: [Property Grunt]( is [presenting what he feels are the best posts submitted to him by carnival members]( and applies his unique insight to the expanding content.

Next week’s host: [Brownstoner]( who takes his obsession with Brooklyn Brownstones to the carnival.

Carnival of Real Estate

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Hard Sell Brokerage, Soft Sell Blogging

June 26, 2006 | 12:01 am | |

The crew at Sellsius sent me a link to a story they posted [NYC Seller Offers 10% Real Estate Commission]( It wasn’t just a post about a 10% listing as a novel marketing technique to differentiate the property. They called and interviewed the listing broker to get more insight, which only helped enhance the post. Good stuff.

They sent me an email directly – not part of a bulk email, suggesting that I post an article about the 10% commission and link to it. While I was appreciative of the gesture, I am not crazy about posts about posts unless they are really funny, quirky or part of a bigger topic in a post I am presenting. But frankly, I got side tracked and never did anything about the post. However, the story was covered by a number of other blogs I like to read so I suspect they were emailed the same way. Sellsius’ soft sell strategy was therefore successful:

  • [10% Commission? Another trend? [UrbanDigs]](
  • [CurbedWire: Big Commission [Curbed]](
  • [Mo Money, Mo Money, Mo Money: Seller jacks up the commission [PropertyGrunt]](
  • [Calling all Brokers/agents [NYHouses4Sale]](

Just like the broker in the 10% listing story, [Sellsius]( probably generated more traffic by approaching their marketing a little differently and each blog enhanced the content of the original post. Still, it bothered me.

That being said, it was still a good post about a changing real estate market.

Lighting A Fire Under The Development Process

May 8, 2006 | 12:02 am | |
Source: Curbed

In The Stalwart, one of my daily must-reads, the post When Property Development Is Outlawed, Only Outlaws Will Develop Property [The Stalwart], talks future development in the aftermath of the Greenpoint, Brooklyn fire [Curbed] that destroyed a bunch of property but could have actually killed many if the wind was in a different direction.

I remember seeing a similar slogan on a billboard as a teenager, on a bike trip through Wyoming: The west wasn’t won with a registered gun. When guns are outlawed, only outlaws will have guns.

These warehouses had been abandoned for some time, and surely the red-tape in getting approval from various board was taking years. Not to mention, there’s a claque of preservationists here who want to keep every abandoned building, truckyard, and empty factory as some sort of memorial to the past.

The trade-off here is that the difficulty in development, provides a large up front risk and cost. What does the difficulty in the development process do to housing costs? It makes them much more expensive. No wonder the only thing that can be built in Manhattan without significant government intervention is luxury housing (although incentives still remain).

Friday Link ‘n Log

April 28, 2006 | 12:05 am |

  • [Jane Jacobs, Social Critic Who Redefined and Championed Cities, Is Dead at 89 [NYT]](
  • [Jane Jacobs [Wikipedia]](
  • [Jane Jacobs, 1916-2006 [AFH]](
  • [Brooklyn: Kicking Demographic Ass Since 1920 [Gothamist]](
  • [Gothamist: Photo of the Day: 1980s Love [Gothamist]](
  • [Best Places to Retire Near Metro Areas [REJ]](
  • [Upset Before Settlement [WaPo]](
  • [Rents heading up in ’06 [CNN/Money]](
  • [Timeshares, Pro and Con (mostly Con) [Searchlight Crusade]](
  • [Fed bank regions report on conditions [BW]](
  • [Selling Your Home in Trickier Times [BW]](

Reconfiguring New York City: A Series Of Articles In The Journal The Stamford Review

February 22, 2006 | 10:25 pm | | Public |

The Stamford Review, Spring/Summer 2006 is the third issue and was just released. It can be [downloaded for free on their web site after a simple registration]( or hard copies can be purchased for a nominal fee. The intention of the publication was to bring together a diverse group of writers who are passionate about their topics to write about issues that affect New York City real estate, land use, architecture, and urban affairs.

See the author list below.

Shameless plug: I wrote two articles for this publication The Gentrification of Manhattan and Manhattan’s Housing Market and the Media

I hope you enjoy them.

Larry Sicular is the editor and has been a professional colleague of mine for 20 years. The journal, which is a labor of love for him, takes a monumental effort to coordinate, edit and publish and I truly appreciated the opportunity to be in it.

In the introduction of the publication, Larry describes the current issue as being:

…about the reconfiguration of New York City, a physical transformation that has been fueled by a mixture of population growth, increased affluence, and an unusually strong housing market. What is happening here is mirrored to varying degrees in successful cities elsewhere in this nation and across the globe.

Here, nine experts praise and critique city government’s efforts to guide this transformation, to meet and balance growing demands for market housing, affordable housing, open space, industrial space, and historic preservation. Even as the housing market softens, these policies will have long-term effects and will continue to be debated.

In recent years it has been easy to forget Jonathan Miller’s reminder that twenty years ago Manhattan’s housing market relied on government tax policy to stimulate demand. Julia Vitullo-Martin applauds the results of public and institutional investment in the Bronx, but she notes that destructive government policies helped depress the borough in the first place.

Much of our attention is drawn to the city’s extensive rezoning of former industrial areas on the Brooklyn waterfront and the west side of Manhattan. Frank Braconi questions whether these initiatives are sufficient to meet the needs of our growing population, while Kimberly Miller and Mark Alexander address what will be required to make the rezonings a success. Peter Beck shows us that limited public resources, directed to these areas for affordable housing, could perhaps be more effectively spent, while Lisa Kersavage shows us how rezoning need not have cost us valuable historic resources. Pamela Hannigan praises the city policy that is creating new industrial business zones in order to preserve and stimulate the valuable manufacturing resources that remain.

And then there is Governors Island. Is there a greater possibility for adding a jewel in our crown than the history and open spaces that this island offers and represents? Our third issue is dedicated to the possibilities of Governors Island.

Creative Brain Drain Weakens Long Term Urban Revitalization

December 21, 2005 | 12:01 am | |

In Daniel Gross wrote a great post in Slate called: [Are Journalists Underpaid? : Pity the sad, broke New York Times reporter [Slate].]( Let me answer that quickly: “Duhhh!!” They are writing stories about some of the most expensive real estate in the world, not forgetting the difficulty and scrutiny their work entails.

The recent real estate article by Jennifer Steinhauer called [New York, Once a Lure, Is Slowly Losing the Creative Set [NYT]]( addresses this point quite clearly.

In a related pattern, the eventual loss of early artisans who pioneered downtown urban locations as residential usually get priced out by hipsters only to start the cycle again somewhere else. This has been occurring with more frequency as urban areas entice residents from outlying suburban areas into their revitalized downtown markets.

The New York Times article, while a fascinating piece, doesn’t quantify the loss, but I suspect it is significant. I haven’t found great data on this yet, so perhaps its too early in the cycle to measure. This phenomenon happened in New York long ago with loft neighborhoods such as Soho, Tribeca, more recently Chelsea and moved on to parts of Brooklyn and now So Bro (South Bronx.)

Enticing the creative to remain is one of the most important issues to sustain urban revitalization efforts in the long term.


Front Yard Politics: Grass Losing Ground To Pavement

November 30, 2005 | 12:01 am | |
Source: NYT

In today’s article [For Some, Grass Is Greener Where There Isn’t Any [NYT]]( the author covers the odd phenomenon of paving over front yards. This has taken on a political undertone in [Kickin’ Asphalt: Pols Attack Front Yard Driveways [Queens Ledger]](

“While there are no official city figures on pave-overs, it is clear that the fight is still being waged in the other boroughs and in some suburbs, where signs of creeping urbanism threaten the leafy suburban aesthetic…New York City has no rules prohibiting property owners from paving over their lawns, but Tony Avella, a city councilman from Queens, hopes to change that…Paving over has become so commonplace that it is spurring differences between neighbors and debates within households about whether to dispense with the lawn.”

Source: NYT

Apparently the same issue is a recent major concern in Dallas where a 50% coverage limit is being proposed: [Council reviews ordinance to limit pavement in yards [Dallas News]](

Some quick research yielded lots of pavement ordinances, but I lost interest after 2:

[Garden Grove, CA](

[Garland Grove TX](

Urban Living On Steroids: 10,000 Sq Ft Boxes on Stilts for $29M to $50M

September 12, 2005 | 10:50 pm |

Its a (Rubik) Cubist’s ultimate fantasy. [A project by architect Santiago Calatrava [NY Post]](, is planned on the East River, South of the Brooklyn Bridge that has received a lot of attention lately for both (high) price and (unusual) design.

[Triplemint]( has a photo spread and [Curbed]( has given the project a lot of attention.

As the housing market continues to rise and the acceptance of high end housing projects remains solid, it is expected that we will see more and more unusual development projects that will scream out for attention.

The Real Deal – The Real Deal Weekly Interview

August 1, 2005 | 10:09 pm | | Podcasts |

The Real Deal – The Real Deal Weekly Interview

I suggested to Amir Korangy of the Real Deal that he begin Podcasting since his publication would be a perfect candidate for it. The Real Deal has access to many interesting people and their content is always changing.

Not only did he look into this technology right away, but he asked me to be the guninea pig…errr…the first interviewee. 😉

From The Real Deal’s Web Site…

Jonathan Miller at The Real Deal Magazine’s first Podcast on July 15, 2005

In The Real Deal’s inaugural interview in its new weekly audiocast series, we sat down with appraiser Jonathan Miller, president of Miller Samuel Real Estate Appraisers and Consultants. Miller’s reports on the Manhattan apartment market are the most widely cited in the industry, and he has been featured in The New York Times, the New York Post and countless other publications including The Real Deal.

With reports showing apartment prices hitting new peaks each quarter but often differing significantly in their findings we asked Miller how he collects his data, and his thoughts on the existence of a real estate bubble. To listen to the entire interview, click one of the links below.

[MP3 Version](/wp-content/The_Real_Deal_Podcast_1.mp3)

[Podcast (RSS) Version](


THE REAL DEAL: Is there a housing bubble in New York?

MILLER: It’s interesting about the whole bubble psychology the boom and bust orientation in the real estate discussions that have been going on for the last three or four months. Especially because Manhattan is closely tied with the financial markets.

A lot of us remember what happened in ’87 with the stock market crash and subsequent real estate correction that we saw from about the end of ’89 to early ’95. So it is something that is fresh in everybody’s minds, and everybody is trying to relate that to the current experience that we are having now.

When I look at what happened then versus now, it’s apples and oranges, a very different experience. Back then we had a tax incentive-based supply-creation syndrome I made that up, but the idea is that housing came on in large quantities in the mid ’80s because of tax incentives. The 421a abatements gave the incentives to developers to throw foundations in the ground without even plans for what they were going to build just to get the tax credits.

Then all of a sudden in ’86 we had the change in the federal tax laws that eliminated the whole incentive for investors to buy individual units that created a lot of supply. And then we had the co-op conversion frenzy, in which seemingly every rental building that could have been converted was converted. I think the conversion pace today not including 2005, but up through the end of 2004 is something like 10 percent of what it was back then, but that’s largely inclusive of, say, lofts being gut renovated to condo as opposed to existing rental buildings.

As far as today, the situation is we have record low mortgage rates, which are really fueling a lot of the demand and we have an improving but very tepid economy. And we now have supply that is gaining momentum. Your magazine did a great study on the condo inventory that is coming online [in July 2005 issue].

TRD: Thank you.

MILLER: And it’s gaining speed. But it’s still about 3,000 units, give or take, and we have a condo universe of somewhere in the neighborhood of 65,000 to 85,000, depending on who you talk to. So it’s still relatively small. In prior years we were talking about 1,500 units coming online. So the pace is increasing but it’s another 1,500 units a year.

I think the two variables on whether we are going to go into a bubble real estate environment is going to be supply or mortgage rates. There are a lot of other things to look at, but those are two main things. Mortgage rates have been forecasted to increase since the end of 2003, and, generally speaking, they’ve been falling. So, in the equation of supply and demand, it has become a constant.

TRD: Brooklyn has become such a great place for developers to go to because there are so many available lots.

MILLER: For those new developments to come in and be viable they are getting $700 a foot. In Manhattan now, the threshold seems to be you have to be at least at 1,000, and more likely on the new developments you’re talking $1,500.

TRD: If you saw a new development at $1,000 per square foot, would you jump on that and say, “Hey, that’s a bargain?”

MILLER: I guess it’s personal preference. You have to decide whether you like the neighborhood. I’ve always felt the reason why [a neighborhood is] cheaper than a Soho and Tribeca is because it’s not proven as yet for that price structure. So you are going to see more price volatility if you have some sort of market downturn meaning that there is a lot of upside and there’s potential downside.

However, the thing about housing which is very different than stocks, is that, for example, the FDIC defines a housing boom as three years and 30 percent appreciation, and a bust is five years and 15 percent depreciation.

TRD: And how does that compare to our market now?

MILLER: On the upside, we’re about double what their boom figure is. But it’s sort of that idea that on a down cycle, prices tend to be sticky on the downside, that it’s still an asset that’s useable. Real estate is a cyclical thing.

We’ve just seen a lot of the upside over the last five to seven years.

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