The volume of commercial property investment sales in New York City cratered in the second quarter because of the coronavirus pandemic, a trend that will likely accelerate in the last half of the year with painful consequences for city tax collections, according to the Wall Street Journal. Investors purchased only 170 properties valued at $3.6 billion between April 1 and the end of June, the lowest number of transactions for a three-month period since the second quarter of 2009.
- Effective decrease in property taxes: The upheaval in commercial real estate could be even more painful to the city budget when it comes to property tax collections because assessed values of office buildings, stores, hotels, and other properties are expected to plummet.
- Stating the obvious: The great majority of the deals that took place in the second quarter of this year already were well along in mid-March when the coronavirus hit. In many cases, the deals were able to close because buyers had already put down nonrefundable deposits or buyers and sellers renegotiated lower prices. [WSJ]