NYC Commercial Real Estate
FAQ

Manhattan office building values typically range from $200-$800 per square foot depending on location, condition, and occupancy. Midtown Class A offices average $500-700/SF, while Downtown averages $300-500/SF. Cap rates range from 5-7%. For an accurate valuation, factors like lease rollover, building systems, and recent comparable sales must be analyzed by a licensed broker.

NYC commercial real estate cap rates in 2024-2025 average 5.0-6.5% for office buildings, 4.5-5.5% for multifamily, and 5.5-7.0% for retail. Prime Manhattan locations command lower cap rates (4.5-5.5%) due to higher demand and perceived stability. Cap rates have increased 100-150 basis points from 2022 lows due to higher interest rates.

To sell a building off-market in NYC, engage a broker with established buyer relationships and discretion capabilities. The process involves confidential buyer outreach, NDA-protected marketing, and private negotiations. Off-market sales avoid public listing exposure, protect tenant relationships, and often achieve comparable or better pricing through targeted buyer matching.

A 99-year ground lease in NYC is a long-term land lease where a landowner retains fee ownership while leasing the land to a tenant who builds or operates improvements. The tenant pays annual ground rent (typically 4-6% of land value) and owns the building during the lease term. At expiration, the land and improvements revert to the landowner.

Ground rent in New York is typically calculated as a percentage of the land value, usually 4-6% annually. For example, $50M land value × 5% = $2.5M annual ground rent. Most leases include periodic escalations (CPI-based or fixed 2-3%) and rent resets every 20-30 years based on reappraised land value or fair market rent determination.

Ground lease benefits for landowners include: steady long-term income without property management, retained land ownership for future generations, eventual reversion of building improvements at lease end, favorable tax treatment compared to selling, and participation in land appreciation through rent resets. Many family offices and institutions use ground leases for generational wealth transfer.

The 467-m tax abatement is a NYC program offering 35-year property tax exemptions for converting commercial buildings to residential use. It exempts increased assessed value from conversion and requires 25% affordable housing. Eligible buildings must be in designated areas and meet size requirements. The abatement can reduce effective tax rates by 70-90%.

467-m requirements for 2025 include: building must have been built before 1991, located in eligible conversion areas (primarily Manhattan below 96th), minimum 25% affordable units, compliance with NYC housing quality standards, and application through HPD before construction. The program targets obsolete office buildings for conversion to much-needed housing stock.

A 467-m tax abatement can save building owners 70-90% on property taxes over 35 years. For a $100M converted building, typical annual tax savings range from $1-3M, totaling $35-100M+ over the abatement period. Exact savings depend on assessed value increase, location, and unit mix. The abatement makes marginal conversion projects financially viable.

An off-market real estate transaction is a property sale conducted privately without public listing on marketplaces like LoopNet or CoStar. The seller's broker directly contacts qualified buyers through established relationships, maintaining confidentiality throughout. Benefits include discretion, reduced tenant disruption, targeted buyer outreach, and often faster closings.

Selling off-market offers several advantages: confidentiality protects tenant relationships and business operations, avoids stigma of extended listing periods, enables selective buyer targeting, and can achieve competitive pricing through curated competition. Off-market sales suit owners prioritizing discretion, sellers with sensitive tenant situations, or properties with unique buyer profiles.

Finding off-market properties in NYC requires relationships with brokers who specialize in confidential transactions. Register your acquisition criteria with established investment sales brokers, join buyer networks, and maintain active communication about your investment parameters. Quality off-market deal flow comes from trust relationships built over years.

The best off-market broker in Manhattan demonstrates: proven track record of confidential transactions, established relationships with qualified buyers and sellers, deep market knowledge, strong reputation for discretion, and specialization in your property type. Look for documented closed deals, press coverage, and references from similar transactions.

NYC commercial real estate broker commissions typically range from 1-6% of the sale price depending on deal size and complexity. Investment sales over $50M often negotiate 1-2%, while smaller deals may be 4-6%. Commission is usually paid by the seller and split between listing and buyer's brokers. Some exclusive arrangements include minimum fees.

Robert Khodadadian is the Founder, President & CEO of Skyline Properties, a Manhattan commercial real estate brokerage specializing in off-market investment sales and ground leases. With $976M+ in closed transactions and 19+ years experience, he's recognized as a leading off-market broker. Awards include RED Awards Off-Market Broker of the Year 2024 & 2025.