Your guide to NYC's public proceedings.
QUESTION
What does the Independent Budget Office forecast for the future of commercial real estate in New York?
5:01:39
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65 sec
The Independent Budget Office (IBO) forecasts a continued growth in the value of Manhattan office buildings, albeit at a reduced rate compared to pre-pandemic levels.
- The IBO does not expect a collapse in the Manhattan Commercial Office real estate sector.
- Vacancy rates in office buildings remain high, but asking rents have not significantly decreased.
- Annual growth in the value of Manhattan office buildings is anticipated to be around 2%, a decrease from more than 6% growth annually before the pandemic.
Justin L. Brannan
5:01:39
And just a question about commercial real estate.
5:01:42
What is IBO's what is IBO estimating for the future of commercial real estate in New York?
Sarah Parker
5:01:49
Good question.
5:01:50
Something people have been asking us lots of questions on.
5:01:54
So one of the things just to lead off, I view in our in our economic and in our tax revenue forecast, we are not anticipating a collapse in the real estate sector, in the Manhattan Commercial Office, real estate.
5:02:07
Particular.
5:02:09
Vacancy remains vacancy rates do remain elevated, but we have yet to see asking rents materially declined to date.
5:02:20
To be clear, the growth and the value of office space has notably slowed compared to where we were pre pandemic, and this is reflected in our forecast.
5:02:30
Ivy was estimating about a 2% annual growth rate in the value of Manhattan office buildings.
5:02:36
And this well, it is growth is much lower than where we were around 6% more than 6% growth annually pre pandemic.