The current state of real estate development in New York City
Where is the New York City real estate market heading in 2018?
Indicators suggest cautious optimism for the coming year, following a more subdued 2017. That was the consensus of insights from a number of prominent real estate professionals who spoke recently at KPMG LLP’s conference, “The Current State of Real Estate Development in New York City.”
While tenants are tending to leave midtown Manhattan for more southern and western parts of the island, overall construction activity is healthy and rents are trending higher. Developers are finding capital in ample supply and from a number of sources, while labor costs are becoming more competitive.
The city government is helping as well. The current administration has embarked on an ambitious program to develop more affordable housing and is looking for private developers to assist in the effort. In addition, the city has rezoned a number of areas, creating more opportunities for real estate developers.
To further fuel development, an unexpected addition to last year’s tax reform legislation pertaining to Qualified Opportunity Zones (QOZs) offers an attractive tax incentive for investors interested in development in low- income areas.
The conference also offered the more than 150 attendees an opportunity to ask questions and have meaningful discussions with KPMG’s leaders in real estate.
The following is a recap of the conference’s presentations and panel discussions along with some recent market observations.