The natural disaster that struck New York in November not only damaged some of Lower Manhattan’s rental properties, it laid waste to the area’s rental market where inventories were already tight.
In the weeks after the storm, rental activity dropped by almost 70% compared to the same period one year ago.
Jonathan Miller, President of the appraisal firm, Miller Samuel, reviewed four zip codes in Lower Manhattan over the three-week period two days after Hurricane Sandy departed: from Nov 1 through 21. He reports that, in 2011, there were 199 closed rentals in the area compared to only 60 for the same period this year. Mr. Miller says the drop in transactions is not due to a lack of demand but rather to so many buildings being inaccessible and taken off the rental market in order to repair storm damage.
Landlords at many of Lower Manhattan’s rental buildings have had to relocate tenants and offer rent abatements. “Inventory remains tight and it is hard to see much in the way of a reprieve in rental price levels as a result of the storm,” Mr. Miller concluded.