Big Updates in the Big Apple

Olshan Real Estate partners Nina Roket and Thomas Kearns published an article in Best Lawyers entitled “Big Updates in the Big Apple.” The article focuses on the New York City commercial real estate market for landlords, investors, and developers post-COVID-19. “Office leasing is showing signs of activity,” Nina and Tom write, “but office building valuations remain in flux as investors question lease renewals in the short term and the recent interest rate increase’s impact on prices. Between the rise of remote work and a surge in e-commerce, the overall trajectory of commercial markets poses both new opportunities and challenges.” They explain that, while many employers are not altering their part-time pandemic office attendance schedules, they still generally want employees together on certain days, thus necessitating the same office space they required before the pandemic, leaving office investors awaiting further clarity. Retail rentals, too, have experienced similar uncertainty. At the same time, residential rentals in New York remain strong: “New York remains very popular with tech, finance, legal, media and other workers, particularly young workers.” Commercial properties that are industrial, they point out, will likely also continue to grow given the proliferation of e-commerce. “Perhaps the most fascinating development in New York,” Nina and Tom write, “is the current political dance between regulations, politicians and the industry about re-positioning older properties, particularly office and outmoded hotels, to purely residential use to help with affordable housing and reinvigorate business districts.” They conclude that not-for-profit affordable housing developers may see increased availability in development sites, writing, “City, State and federal affordable housing financings have become more accessible since there is less of a ‘sign here now with a big non-refundable deposit’ market.”