By Daniel Geiger
October 31, 2017
As commercial real estate sales have plummeted by at least 50% over the past year, some New York City brokers have shifted to what is proving to be a resilient segment of the market: office condominiums.
“There’s a handful of brokers that have jumped into office condo deals more recently,” said Jeff Nissani, who restarted his own brokerage business, JSN Properties, after stints at Marcus & Milichap and Eastern Consolidated.
Nissani just sold a unit at 70 West 36th St. for $10.85 million on behalf of Vetta, a jewelry company that had purchased the roughly 10,800 square foot space for its own use several years ago. The buyer was Local 600, the International Cinematographers Guild.
James Nelson, an investment sales broker at Cushman & Wakefield who made a name for himself by selling several large land parcels in recent years, also recently jumped into office condo sales. Nelson picked up assignments to sell units in 18 and 20 West 33rd streets and 30 units totaling 100,000 square feet at the base of the East Side residential tower, the Corinthian.
The three properties are all owned by the real estate investment firm 60 Guilders and are being sold as individual office condos for purchase by individual tenants or investor groups.
“When you look at the market you see sales falling for office, retail and residential,” Nelson said. “But commercial condos are a different story. We’re projecting that segment of the market to grow.”
Michael Rudder, the principal of Rudder Property Group, which specializes in office condo sales, estimates there are about 10 million square feet of office condo space in the city and that the dollar volume of annual sales fluctuates between $300-$500 million, where he predicts sales will be for 2017.
“It has been a very steady market,” he said.
Rudder, who estimates his firm will handle 75% of Manhattan’s condo sales this year by dollar volume, said he welcomes the increased competition from other brokers.
“If there are more brokers out there pitching office tenants on the benefits of owning rather than renting,” Rudder said, “that’s a good thing for everyone in the office condo industry.”