In this episode of Coffee & Cap Rates, Shimon Shkury, President and Founder of Ariel Property Advisors, discussed Ariel Property Advisors’ Bronx 2026 Mid-Year Commercial Real Estate Trends report with Senior Director Jason M. Gold and Director Daniel Mahfar.

Topics included the current state of the Bronx real estate market, with a specific focus on multifamily housing and development.

• Multifamily Housing Market:
  • In the first half of the year, dollar volume for multifamily transactions in the Bronx was approximately $350 million, a 36% decrease compared to the same period last year.
  • Market activity is driven in part by lenders and borrowers navigating loan maturities and short sales.
  • The market is characterized by older housing stock that is predominantly rent-stabilized where the average price per unit fell to $69,000. Cap rates on these assets are nearing 9%, and GRM is approximately 5.4%.
  • Projections for the second half of the year suggest these metrics will decline further, with GRM possibly reaching four times and price per door averaging between $50,000 and $60,000.
• Development Market:
  • Development has been a bright spot in the Bronx, showing a 14% year-over-year and 15% quarter-over-quarter increase in dollar volume.
  • While transaction volume was slightly down, there is high demand for development sites of various sizes, often resulting in double-digit competing offers.
  • The average price per buildable square foot on an "as of right" basis is trending toward $110, which is the highest in the market's history.
  • Developers are actively looking to leverage the "City of Yes" initiative, which influences valuations for sites with additional air rights.
  • Major upcoming projects, such as the Ferry Point casino, are expected to contribute significantly to the area.
• Future Outlook:
  • Participants expressed optimism for the next six months, anticipating increased investor confidence as the current administration's policies become clearer.
  • It is expected that transaction volume will be slightly higher, while dollar volume is projected to remain relatively stable.
  • Development is expected to remain a popular and competitive investment area in the borough.
• More information about the Bronx market is available here: Ariel Property Advisors’ Bronx 2026 Mid-Year Commercial Real Estate Trends report