Commercial Real Estate in New York
June 13, 2023
The commercial real estate sector in New York has not returned to its prior strength. The region is attempting to have a complete recovery from the pandemic. While the residential rental market seems to have bounced back, the office markets have not, due to the shift in remote working and online shopping. Currently, commercial rents in Manhattan are down quite a bit. It seems that this weakening trend is continuing as more commercial tenants are having fewer workers come to the office. The absence of office workers puts a strain on the New York City economy. Without the presence of workers in the office, it means that they are not patronizing store fronts, restaurants, and other service sectors. Currently challenging that situation are workers that are coming back to the office so infrequently.
The commercial real estate sector is heavily dependent on borrowing in order to function. The Federal Reserve has raised rates which has increased the cost of financing commercial properties. These challenges are further exacerbated by the troubles of the smaller banks such as in the failure of Silicon Valley bank. It is yet to be revealed what this ongoing stress in New York City commercial real estate is going to finally result in. New York real estate has always held strong, but in the current climate of debt ceiling and inflation that currently does not see an end.
There are many different steps in purchasing commercial real estate. You must have a seasoned Real Estate Attorney to navigate your purchase or sale of same. The office of David Scillieri, Esq. is experienced in commercial and residential real estate matters for over 40 years.