The price per square foot of elevator and mixed-use apartment buildings in Brooklyn posted solid increases in the second half of 2007, according to the latest figures from the Massey Knakal Realty Services New York City Income Property Report. And while the total number of apartment buildings sold in Brooklyn was down, the number of elevator buildings sold jumped.
The price per square foot for Brooklyn mixed-use buildings, typically apartment buildings with retail or commercial on the lower floors, in the second half of 2007 reached $265, an increase of 6.8 percent from both the first half of the year and the last half of 2006. The price for elevator buildings was up by 8.5 percent to $115 per square foot in the second half of 2007, compared to the first half of the year, and increased by 13.9 percent from the last half of 2006. Walk-up prices, however, dropped slightly to $186, down by 2.6 percent from the previous six-month period and down 4.6 percent from the second half of 2006.
The number of apartment buildings sold borough-wide in the last half of 2007 fell to 746, down 7.3 percent from the first half of the year and 11.2 percent from the last half of 2006. Of the three apartment building categories, only the number of elevator buildings sold increased. Fifty-three elevator buildings were sold in the second half of 2007, an increase of more than 60 percent over the number sold in the second half of 2006 and more than double the number sold in the first half of 2007.
The number of walk-ups and mixed-use buildings sold both fell in the second half of 2007. Walk-ups were down only 1.1 percent from the first half of 2007, but by 11.5 percent since the second half of 2006. The number of mixed-use buildings sold dropped more steeply – by 18.1 percent from the second half of 2007 and by 23.8 percent from the first half of 2007.
“Unlike the city overall where prices were generally higher and the number of buildings sold were lower, Brooklyn was a mixed bag,” said Massey Knakal Chairman Robert Knakal. “The data in our report, however, still suggests strength in the Brooklyn investment property market. For the most part, there were solid gains in prices and the one category of buildings where prices did drop, the reduction was minimal. With rental housing in such tight demand now and with demand expected to continue growing, Brooklyn rental buildings continue to be a solid investment, as evidenced by stable capitalization rates and gross income multipliers.”
Citywide (excluding Staten Island, which is not tracked by the report), prices per square foot of all classes of apartment buildings in the last half of 2007 were up slightly to $234 — that’s a four-percent increase from the same period a year earlier and a 1.3-percent uptick from the first half of the year. The number of buildings sold citywide in the last half of 2007 was down 16.9 percent as compared to the first half of the year and down 6.9 percent from the second half of 2006.
