Number of NYC Commercial Real Estate Deals Down 61% This Year

Citing data from a recent survey by Real Capital Analytics of New York, a Bloomberg article published this morning brings to attention growing concerns related to the so-far relatively unscathed commercial real estate market.

Through October, data is indicating that transactions in New York City's commercial real estate market have fallen 61% as lenders faced with extremely high rates have moved into their shells and buyers have remained on the sidelines. Further, only about $17 billion of transactions have closed this year and sellers have only made about 237 deals of $5 million or more, a 4-yr low "in a market that posted a record $51 billion in sales in 2007."

Although concerns in the commercial real estate market have been widely speculated about over the last several months given losses in the real estate market's residential space, investors and market-players have yet to see wide-spread evidence of such an event. According to the Bloomberg report, about 85% of domestic banks have tightened lending standards on commercial and industrial loans to firms over the last 3 months, which is the highest level since the Fed's Senior Loan Officer Survey began in 1991.

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