The retail property market has fluctuated between 2009 and mid-2011. However, from mid-2011 through 2013, the demand for retail property has seen a rather aggressive upswing with the number of retail listings available fallen over the past couple of months. According to Loopnet (an online commercial real estate listing service), with an exceptional slight dip in demand in mid 2012, the interest in retail property has risen 5.9% since June of 2012 in the NY metropolitan area, and similarly over the past year the demand has risen 36.9%, making NYC one of the top favorable cities in all metro areas.
The retail market in Northern Queens has been seeing great activity in 2013 so far. We have received attractive offers on a number of our retail driven listings showing great metrics for the market. A prime corner retail assemblage on Northern Boulevard in Douglaston has offers that equate to a 6.5% capitalization rate, and $550/SF, well over the market average for the past few years. Another retail property in Queens we sold at 34-45 Junction Boulevard in Jackson Heights for $725,000 is projecting a 6.75% capitalization rate and $453/SF.
Long Island is also showing a strong retail pockets as well. On Jericho Turnpike in Mineola, a five-unit retail strip is seeing offers in the $1.5 million range, equating to $222/SF and a 6.9% potential cap rate. Additionally, we just put under contract bank-leased building with a 4.5% cap rate. With low quality product availability, this property was on the market for nearly two weeks before it went under contract.
The numbers the retail market is projecting is encouraging to today’s sellers. Highly favorable sales metrics have been consistent in Queens and certain parts of Long Island through the first quarter of this year and I am expecting to see a continuing trend through the rest of 2013.