New York City is one of those classic examples that brings “what goes down must come up” to life. It is a city that demonstrates survivor skills, and a downturn presents itself as an opportunity to start anew. In what I’m sure is no coincidence, the famed residents of this unique locale seem to practice what the city preaches. A less-than-stable economy is a precursor for change, and those who can recognize the opportunity above the chaos have historically risen to the top.
Some prime examples include John D. Rockefeller, Mutual of America, and the Durst clan; all who have seen economic turmoil as their chance to acquire and conquer. Rockefeller’s famed Center was created in the heart of the Depression, Mutual of America’s Park Avenue real estate purchase over 15 years ago has been a residual revenue source; and the Durst’s prime NYC property purchase over a decade ago has been a booming, billion- dollar asset for the family.
Essentially, timing is of the essence—and that time seems to be near upon us for taking a stake of Manhattan. The signs are materializing, most clairvoyantly in the form of a steady, yet slow, decline of rents’ asking prices. Short-term negotiations are becoming more widely accepted by leasers for those companies whose future is up in the air. Aside from commercial space, individual properties have seen a slip in rent of more than 10 percent for apartments in the Manhattan area—a significant feat for the necessary middle-class stabilization.
Government-funding also takes a piece of the limelight in times like these. Current projects (like the subway’s No. 7 train expansion, continual work on the Third Water Tunnel, and Fulton St. Transit Center) take from a precedent set in the mid-1930s, when the Federal Works Progress Administration went $1 for every $7 to team up with the Public Works Administration to give society construction gifts such as the Lincoln Tunnel and LaGuardia Airport among other aesthetic amenities.
Investors are of a thriving kind in this market as well. Out-of-towners migrate into New York and remind the locals of the value that they are living amongst. Foreign investors made up over half of the total office purchases in Manhattan, a significant upturn from previous percentages as low as one-fifth. Appeasing exchange rates have contributed to this, in conjunction with New York’s open arms reputation of accepting the “huddled masses yearning to breathe free,” though realistically, not much worth mentioning in New York is free, per se.
Regardless of where it comes from—local New Yorkers, fellow Americans infiltrating NYC, or the vast population of international imports; there is a promising light on the horizon that ensures us all that from here, the only way to go is up.
Via: The Observer