Brexit could buoy foreign investment in New York City properties.
Top real estate executives greeted Britain’s decision on Thursday to exit the European Union—viewing the move as a boost to the New York City commercial and residential estate market.
“I think it helps New York City because it shows that this is the one place that is really stable and people feel confident investing here,” said Gary Barnett, one of the city’s most prolific residential developers who is in the process of erecting the tallest tower, by roof height, in the Western Hemisphere on Billionaire’s Row in Manhattan. “Assuming it doesn’t hurt the stock market for an extended period of time, it’s not a negative.”
New York City and London have long competed for the same international real estate investment dollars and Brexit will direct more money to the city as investors seek out safety, said Bob Knakal, Cushman & Wakefield’s chairman of investment sales in the city.
“It has created uncertainty. Global capital will be much more directed to New York now than London, in cases where investors have the option to choose between the two markets,” he added.
Different property types could be impacted in various ways. While investment properties like office buildings and multi-family residential buildings may be buoyed by more international dollars, the sale of luxury apartments—a market that depends largely on foreign buyers—could be hurt by a falling Euro and British Pound Sterling.
“I’m not thrilled the pound is at its very weakest point in 30 years,” said a high-end residential developer, noting that could hurt condo sales at his projects. “But like with anything, you can’t overreact because real estate is a long game and you have to let the market shake out before drawing conclusions.”
