Featured in The Wall Street Transcript’s Best CEO Interviews of 2015
Michael Happel, CEO and President of New York REIT, Inc. (NYSE:NYRT), recently told TWST the company’s New York City properties are currently renting below current market value.
“We’ve got a great portfolio. As you know, it’s 100% located in New York City. We have 23 properties, and our average occupancy at the end of the second quarter was approximately 97%, and our average remaining lease term was approximately 10 years. It’s also important to understand that we believe our average existing rents are 10% to 15% below today’s market rents, so we think there is embedded value in the portfolio,” he said.
Happel says the New York City focus on NYRT gives the real estate investment trust an edge, and he says New York is rebounding and is now stronger than it has been.
“I will also comment that the leasing market in New York City is really stronger than I have seen it in the last seven or eight years. It has absolutely shifted, in my opinion, from a tenant’s market to a landlord’s market. Vacancy in the New York City office market is declining, and maybe even more importantly, we are starting to see double-digit rent growth year over year. For the last couple of quarters, the New York City office market has seen approximately 10% rent growth year over year. And it’s interesting, for many years now, some experts have been predicting rent spike in New York City, and I think we are probably in the early stages of the rent spike,” he said.
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