New York stands as one of the most active real estate markets in the United States, and with this in mind, it is unsurprising that it remains poised for additional change in 2019’s latter months. From shifts in financing to developments in competitive incentives for existing property tenants, much of this activity has been rekindled or completely redirected into the city’s commercial market.
As the year nears its halfway point, here are a few trends to keep an eye on as the market continues to evolve.
Rising interest rates
Late 2018 brought reported spikes in interest rates, and this has carried over into 2019. In fact, many real estate analysts have committed to projections that New York’s market, including its commercial sectors, will continue to observe a steady climb in interest throughout the rest of the year. Ultimately, it is assumed that these changes will “lead New York towards a stronger economy.”
Canada’s impact
An increasing amount of Canadian businesses have started to lease commercial property in New York, and this looks to be a growing trend throughout 2019 and beyond. Throughout the year, it is expected that even more Canadian leasing will take place — especially within office-based real estate — and this, in turn, has led New York real estate professionals to scheme ways to attract new tenants stemming from these transactions.
More concessions
Due to a projected uptick in new high-profile pieces of real estate, owners of existing properties are implementing more rent concessions to keep their tenants and directly compete with new properties offering “more modern amenities.” As these new structures continue to be erected within New York’s skyline, it is almost guaranteed that subsequent pressure will keep these concessions coming for the foreseeable future.
A shift from traditional loans
Though there are a variety of new opportunities emerging in New York’s real estate market, some changes have resulted in a general shift from traditional lending channels. With interest rates projected to go up on loans, many have moved from traditional financing to commercial lenders, “who understand the local markets and who are not under the same restrictions as traditional lending institutions.” This effect appears to be a likely long standing trend in NY’s 2019 commercial market.