In the 2012 calendar year, it is evident that there has been a further decrease in capitalization rates from 2011. Since 2011, the cap rate compression has bounced back strongly with the multifamily marketplace holding the highest demand in Queens. Overall in the Northern Queens area, the commercial and investment property markets saw a 25% increase in 2012 with a total of 123 commercial and investment properties sold amounting to $288,000,000 in sales.
Multifamily properties in Queens in 2012 showed great performance and favorable metrics, with notable marks made in categories such as cap rate and gross rent multiple (GRM). There were 20 walk-up apartment buildings that sold in Northern Queens amounting to $37,440,000 and a total of 3 elevator apartment buildings (all in the Flushing area) amounting to $35,493,240.
Among the many multifamily properties sold in the past year, the Massey Knakal Queens office handled a few notable transactions including a 96-unit elevator 89-10 Whitney Avenue in Elmhurst sold for $12,150,000. This calculates to $136.07 per square foot, $126,563 per unit, a 4.10% cap rate, and an 11.45 GRM. Another prominent multifamily property sale was a walk-up apartment building at 35-11-15 Linden Place in Flushing which sold for $2,925,000, equating to $243.75 per square foot, $182,813 per unit, a 6.84% cap rate, and a 10.45 GRM.
Lastly, I just put an elevator apartment building into contract which will surpass pre-bubble pricing in Cap Rate and Gross Rent Multiple, a 49-unit elevator apartment in Flushing will generate an approximate 4% cap rate and nearly 12 times Gross Rent Multiple upon sale. With a low available stock of multifamily apartment buildings for sale along with extremely favorable lending options for this asset class, we should continue to see record-breaking numbers proving to be a rare market dynamic with tremendous possibilities for multifamily owners who may want to test this multifamily starved marketplace.