The Bronx: New York’s hippest office market
Just over a month ago in New York, a former industrial warehouse turned loft-like office space with 93 percent occupancy sold for $114 million. See if you can guess where the building is located:
- The Bronx
If you guessed 4) you got lucky, were involved in the transaction or are keenly aware of New York’s hippest new office market. The sale of the landmarked BankNote building, at 890 Garrison Avenue in the Bronx’s Hunts Point neighborhood, is perhaps the most eye-catching deal in a borough that’s rife with redevelopment.
According to The Real Deal, Bronx saw $1.3 billion in real-estate deals in 2013 and another $895 million invested in real estate and development, an increase of nearly 33 percent since 2010.
Similar to the fashionable locations in Brooklyn and Queens, much of the capital in The Bronx went to convert the industrial properties that dominate the landscape into residential, retail and office space that investors are betting will yield superior returns to traditional investment submarkets in New York City.
Yields in the Bronx and other boroughs are in the five to six percent range — as much as 100 basis points over typical Manhattan returns.
“Manhattan will always be in the conversation about top real estate markets, but investors are a bit frustrated with the growing global demand relative to opportunities in Manhattan,” says JLL Vice Chairman Scott Latham.
“Investors are expanding their reach to Brooklyn, Queens and the Bronx, seeking growth corridors at a more attractive basis.”