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Should foreign investors prepare for a New York City real estate boom?

| Jul 20, 2021 | Firm News |

International investors have been justifiably wary as they observe current high-end real estate trends in New York City.

However, recent signs may indicate a rapid and unusual rebound in the near future.

Will there be an uptick in sales of distressed assets?

Veteran members of the international investment community have learned that recoveries in the New York City property market take time due to the complexity and size of the local economy. Because of this, strategic planning is essential.

After a prolonged decline in the demand for valuable real estate, early signs of improvement typically include a growing number of transactions involving purchasers acquiring distressed properties from overextended owners who can no longer cope with revenue declines.

Why does this rebound look different?

The real estate recovery may look different because of the strength of the basic economic factors prior to the last downturn. Recent disruptions to the economy were mostly intentional and understandable, allowing for more predictability regarding distressed assets.

This means that there are clearly definable sectors of the New York City real estate market that are still moving towards recovery. These include multifamily housing properties, which have had to accommodate restrictions on evictions and rent increases, and hospitality properties, which are still coping with restrictions on international travel.

It is also clear that there are sectors of the property market primed for quick growth. Retail and other storefront-based businesses are already seeing significant upswings as patrons return to their previous lifestyles, and residential leases are up by over 50%. Savvy investors have plenty of opportunities to capitalize on the improving real estate landscape.