“It’s not the market I care about, it’s the deal.”
Last week, I was in the office of a Billionaire real estate investor, who was discussing all of the deals he has in progress. He’s currently acquiring hundreds of millions of dollars of NYC real estate through purchasing distressed debt, partnership buyouts, recapitalizations, and outright building sales.
New York has a lot of billionaires. Many of them have achieved that status by seeing things differently, and many of them are as active as ever in real estate. I look around today and see a constantly shifting retail properties market, driven by factors including rising Retail leasing demand, fluctuating interest rates, maturing mortgages, the Signature Bank loan pool, new risks of supply chain inflation, and upcoming elections. Meanwhile, the Billionaire I spoke with sees the market deal by deal, and finds plenty of reasons for optimism. In fact right now there is a lot of optimism plus urgency.
Let’s pause for a moment to analyze what happened last month on Fifth Avenue. Prada purchased 720 and 724 Fifth Avenue for a total of $807,395,000, while Gucci acquired 715-717 for $963,000,000. Global giants do not pour hundreds of millions into NYC retail without good reason; Meanwhile, having two world class retail locations permanently off the leasing market will raise the value of others on the Fifth Avenue corridor, perhaps a sign of things to come.
If you would like to know more, feel free to reach me at (212) 430-5269 or Trever.Gallina@marcusmillichap.com