Commercial properties and office buildings in Manhattan are overvalued, compared with commercial real estate in other major global cities, according to the results of a survey conducted by accounting firm Marks Paneth & Shron (MP&S). Most of the New York property executives who participated (54 per cent) said Manhattan was overvalued, and only 28 per cent placed it in the fairly valued category, according to the Summer 2013 MP&S Gotham Commercial Real Estate Monitor.
Over 100 property executives shared their opinions anonymously during June and July. Industry members have stuck to this view consistently. The same percentage of respondents polled for the Winter 2013 Gotham Commercial Real Estate Monitor called Manhattan real estate overvalued.
Most real estate executives who participated in the survey do not believe that the market is getting back to pre-recession levels quickly. According to William H. Jennings, the Partner-in-Charge of the Real Estate Group at MP&S, there may be an underlying feeling that foreign investors are inflating property values in that part of the City.
The results indicate that Manhattan real estate is dependent on the global economy as well as the local one. Mr. Jennings went on to comment recently that the question is whether the strength or weakness in the global economy makes values in Manhattan increase. The answer is likely that, “It depends.”
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