As the real estate market in the New York region grows, numerous companies are expanding their business plans with hopes of riding the upward trend.
United Realty Partners, an investment management firm based in New York, is an example of once such company. Founded by Jacob Frydman and Mr. Eli Verschleiser, over the past few months it has raised two new funds, United Realty America Fund and United Realty Trust, to take advantage of this promising time.
CEO Jacob Frydman explained the company’s basic strategy:
“We believe that if you put a large amount of capital today and you leverage at historically interest rates, you are able to buy low, enhance assets and sell high.”
He added, “We think this is a unique opportunity in U.S. history to buy real estate, because prices are below replacement costs and there is the potential for significant return.”
United Realty America Fund and United Realty Trust both aim to maximize this potential. The fund focuses on core and value-added properties throughout the United States, while the trust will specialize in East Coast acquisitions in retail, hospitality, office and industrial divisions. It will also operate in the single-tenant multifamily property sector.
The company is also boosting its other branches, including its investment banking group United Realty Advisors, where Mr. Dov Shimanowitz was recently hired as executive vice president.
Commercial real estate in New York City is on the rise and transactions have increased significantly during recent months. The improvement is mainly a result of the heightened interest of both local and international investors. Despite numerous economic setbacks, NY’s real estate market has kept afloat thanks to its low interest rates and the city’s worldwide popularity.
According to the New York Real Estate Journal, “interest rates are as low as 3% and the Fed has indicated that rates will remain at this level for the nect few years. Rates are lowered to boost the economy and, as far as local real estate goes, it’s working because the New York City real estate market is booming! The low rates, as well as the lack of other viable investments, are a major driving force behind the upsurge in activity.”
Local businesses and the U.S.’s overall economy are benefitting from the upswing in New York’s commercial real estate industry as agencies and law, environmental and engineering firms flourish from the business. NY neighborhoods are also seeing the advantages as buildings are renovated and areas are revitalized.
Recent developments in New York’s commercial real estate market imply that there is a definite positive outlook amongst the pros.
Morris Companies, a developer based in Rutherford, recently broke ground in a $50 million warehouse in Newark’s Ironbound district. What makes the step particularly bold is the fact that a tenant has yet to commit to the spot.
The facility, which will cover 337,000 square feet, is located right alongside Port Newark and New York City, which adds loads to its appeal, according to the company. The port, which belongs to both NY and NJ, is known as one of the most important to the area’s industry. It supports almost 280,000 jobs already, while numerous developers expect that number to rise as the Panama Canal expansion triggers additional growth.
“This port is going to be hot,” NAIOP’s Michael G. McGuinness said. “It’s already hot, but it’s going to get hotter. Anybody that’s in the industrial sector is probably in a good mood because they’re seeing the light at the end of the tunnel.”