Cap rates in Harlem NYC
Hi guys!
I am reading up on NYC multifamily market and unfortunately do not have access to paid databases.
I would greatly appreciate if someone could advise on what sort of cap rates you would observe in Harlem area right now?
Many thanks in advance!
Cap Rates are high.... There is typically a 30-40 percent chance you get capped in Harlem at anytime. Take your money elsewhere.
I see things that trade around 4%. This is very dependent on numerous variables, especially if the building is subject to stabilization or rent control.
Appreciate the responses guys.
To be more specific Im looking at class B properties with 15-30 units, say all rent stabilized
Given that 30-40% chance mentioned by Mark, I thought caps would be somewhat higher than 4%, haha
where in Harlem and what side?
Also value-add which is what Rent Regulated buildings have become are trading to at the price of the npv sale price in 5-10 years minus a developer return, minus renovation cost.
I wish they traded at higher than 4 caps. The truth is rent stabilized buildings don't carry much risk so why would they be trading at a higher cap, except that they are old stock. But then again nyc is supply constrained.
Less risk and a lot of upside if you are good at evicting rent stabilized tenants. Probably not the most fulfilling job in the world but I know guys that make a killing doing that.
would put the cap rates between 4 and 5%, but the real money is in the price appreciation rather than the rent roll. IRR should be 12% plus.
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