Manhattan’s commercial real estate transactions totaled $3.7 billion in the third quarter, which is 28 percent below the trailing four-quarter average of $5.2 billion. By annualizing the first three quarters, 2019 in on pace for sales totaling $16.3 billion, 32.7 percent below the $24.3 billion recorded in 2018

However large trades dominated the third quarter, even as transactions fell to 53 from 76 in the previous quarter and declined by 36 percent from the four-quarter average. Based on the first three quarters, total trades for 2019 are projected to be 277, which is 8 percent below the previously recorded 10-year low of 300 sales in 2017.

These are the major takeaways from the Avison Young Third Quarter 2019 Property Sales Report.

“The third quarter investment sales report indicates that even with declining sales numbers, we’re still seeing large trades and a healthy appetite for trophy assets,”said James Nelson, Principal and Head of Avison Young’s Tri-State Investment Sales Group.

The report highlights the following asset classes:

Multi-Family

Manhattan saw $664 million in multi-family sales across 20 transactions in the thirdquarter, as investors continued their flight to quality. Major transactions for the quarterincluded 220 East 72nd Street, which traded for $159.5 million, or $1,021 per square foot,60 East 12th Street, which traded for $106.5 million, or $823 per square foot, and 25 East67th Street, which sold for $70 million, or $1,810 per square foot. Cap rates averaged4.34 percent, 31 basis points above the trailing four-quarter average, while the weightedaverage price per square foot of $929 was 6 percent higher than the four-quarter average.

Retail

The retail sector in the third quarter recorded six transactions totaling $175 million,which is higher than the $153 million closed in the second quarter, but 38 percent lowerthan the trailing four-quarter average. Significant sales included 196 Orchard Street withtenants CVS, Marshall’s and Equinox, which traded for $88.8 million, or $1,464 per squarefoot, and 47-49 Greene Street with tenant Theory, which traded for $24.8 million, or$3,397 per square foot. Cap rates averaged 5.20 percent, 25 basis points higher than thetrailing four-quarter average, and the price per square foot averaged $1,449, which was39 percent lower than the four-quarter average.

Office Building and Office Condo

In the office sector, there were nine office building transactions in the third quartertotaling $2.1 billion, and four office condo/co-op transactions totaling $88 million. TheCoca Cola office building at 711 Fifth Avenue sold for $907 million, or $2,563 per squarefoot, which helped push the average price per square foot for office buildings to $1,322per square foot, a jump of 71 percent from the four-quarter average. It was reported that711 Fifth Avenue will be resold for $955 million, which along with several other majorsales announced, should result in strong volume in coming quarters. The largest officecondo/co-op transaction was the sale of the entire sixth floor of 866 United Nations Plazafor $59.2 million, or $800 per square foot.

Development

In a particularly slow quarter, there were only four development sales totaling $321million, a 51 percent decline from the trailing four-quarter average. A total of 520,000buildable square feet traded during the quarter, which represented an 86 percent declinefrom the four-quarter average, while the weighted average price per buildable squarefoot was $618, an 11 percent decline from the four-quarter average. Significant salesincluded 1461-1469 Third Avenue and 204 East 83rd Street for $167 million, or $668 perbuildable square foot, and a development site at Lexington and 56th Street, which soldfor $103.7 million, or $593 per buildable square foot. Development volume is projectedto end the year at $1 billion, the lowest level of any year since 2010 when development sales totaled $802 million.

To review the full report, please click HERE.

Avison Young is the world’s fastest-growing commercial real estate services firm. Headquar-tered in Toronto, Canada, Avison Young is a collaborative, global firm owned and operated by its Principals. Founded in 1978, with legacies dating back more than 200 years, the company comprises approximately 5,000 real estate professionals in 120 offices in 20 countries. The firm’s experts provide value-added, client-centric investment sales, leasing, advisory, manage-ment and financing services to clients across the office, retail, industrial, multi-family and hospi-tality sectors.