After the poignant discussion on market capital flows at the annual Cornell Real Estate Conference, a highly esteemed panel consisting of Joshua Eisenberg (Urban American), John Jacobsson (The Related Companies), William Macklowe (William Macklowe Company), and Jonathan Moore (The Brookfield Property Group) forged into uncovering the truths within New York City’s growing multifamily development market.
A major focus of the discussion was the partnership between The Related Companies and The Brookfield Property Group on the Hudson Yards project in the Midtown West section of Manhattan. David Rupert of Griffin Capital Corporation, who was interviewed the previous night, served as the moderator and facilitated the uncovering of Brookfield’s five-prong strategy to devote around $10 billion to real estate over the next 5 years through public and private funds. Further, John Jacobsson touched on the how class B assets have been impacted, in particular, due to the fact that multifamily within the city limits receives what amounts to hospitality underwriting, and is based on trough income.
Josh Eisenberg created a buzz when he revealed some of his brother James Eisenberg’s trade secrets. By tapping into smartphone use, Urban American has been able to focus their acquisition and development of multifamily real estate by analyzing consumer comments of restaurants and retail within any particular locality. By viewing the evening and nightlife activity in an area, Urban American decides where to focus their acquisition efforts. In addition, Urban American looks to provide additional value to their properties by devoting significant time, energy, and capital to overall operations, ranging from security to personnel. The operations-based approach has been a central pillar to their success.
Additionally, the panel discussed the effect of populations in transition from certain sections of Manhattan to others. They viewed market momentum moving from the Upper East Side to sections of Queens as a short-lived trend. Although the prices across the river and the population desires of community are in line with the millennial demographic, the panel unanimously agreed that once these professionals had children entering school, they would make their way back to Manhattan.
