Ryan McCaffrey

#RealEstate attorney Stuart Saft authored an article for citybiz about the potential impacts of proposed #legislation in #NewYork on ground #leases for cooperative buildings. Mr. Saft warns the bills could significantly destabilize the industry through favoring a select group of co-op shareholders and eroding property rights. Read for more insights more insights on the potential repercussions for #lenders and the #housingmarket in #NYC: https://bit.ly/4bCnjZd

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A new policy change by The Real Estate Board of New York (REBNY) will likely result in dramatic changes to the real estate industry. These modifications by REBNY and other real estate regulatory entities are revolutionizing traditional commission frameworks and advocating for a more engaging and client-oriented approach to real estate transactions. Learn more in my latest blog post https://ow.ly/cvLL50RfnnJ

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🏢 Exciting news for New York's real estate developers! The 421-a tax exemption program has been extended, providing a much-needed boost to stalled projects 🏗️💼 This extension is a game-changer for the industry, as it encourages the development of affordable housing units. With the 421-a program back in action, developers can now explore new opportunities and create innovative solutions to address the city's housing needs. As the industry navigates this new landscape, all eyes are on the potential successors to the 421-a program. Stay tuned as we dive deeper into the implications of this extension and the future of affordable housing development in New York City. #421aExtension #AffordableHousing #RealEstateDevelopment #NewYorkCity #Bisnow

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City of Yes marches forward with the approval of the second of three major initiatives: Zoning for Economic Opportunity. Check out our alert below, which provides a high level overview of some of the highlights.

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My latest article in this week's NY Real Estate Journal: "Does a recent sale impact property taxes? It all depends"

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In honor of #pridemonth2024, I wanted to share some relevant financial and estate planning guidance throughout the month: 7. Educate yourself on the values and lived experiences of your clients (and family members). When it comes to inclusion, education and a willingness to learn from, and communicate with, others is critically important. As advisors for the LGBTQ community, we can have better conversations with our clients when we know about their values and lived experiences, as well as those of their family members. Consider talking with other advisors about their experiences working with similar types of clients, but also appreciate that each client relationship might differ for their preferences and circumstances. One example is how coupled clients refer to one another (i.e., spouses, wife/wife, partner or by name). Using the same language when referring to them in conversation and correspondence can reinforce that you hear and see them. For further education, consider attending a Philadelphia Estate Planning Council Roundtable on June 17, 2024 at noon titled "The Rainbow Legacy: Estate and Charitable Planning for the LGBTQ+ Community" that Thomas Moore, CAP®, Rachel Kieser, CPA, MT and I are leading: https://lnkd.in/ej-V_Dw4. #LGBTQplanning. #chosenfamily. #LGBTQeducation. #inclusion.

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Ground lease financing is the way of the future! (And present)

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Last month, our partners at Novogradac & Company LLP published a blog post analyzing the The White House’s proposition to expand the low-income housing tax credit (LIHTC) and create a neighborhood homes tax credit (NHTC) in its FY 2025 budget. The post strategically lays out the important distinctions between the impacts of the proposals and the Neighborhood Homes Investment Act, a bipartisan bill reintroduced this Congress that would create a federal tax credit to support building or renovating owner-occupied homes in distressed neighborhoods. Novogradac estimates the combined LIHTC and NHTC proposals would generate the construction and preservation of an additional 1.73 million affordable homes over 2025-2034,  breaking down the distribution of this number between states and their respective economic impacts on jobs, wages and business income, as well as federal, state and local tax revenue generated. NCST and the Homeownership Alliance commend Novogradac & Company LLP for compiling this predictive document, further emphasizing the importance of leading both LIHTC improvements and the the Neighborhood Homes Investment Act to passage.

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There have been a lot of headlines on the liquidity issues faced by non-publicly traded REITs, particularly Blackstone’s B-REIT and Starwood's S-REIT. Both firms have been facing major liquidity squeezes... but is panic warranted? My two cents: things are going to be OK. Given the number of questions I’ve received on the issue, I wanted to lay out the facts and offer my perspective: 🤔 What's a Non-Traded REIT? Unlike publicly traded REITs with readily available stock market liquidity, non-traded REITs (NTRs) offer limited redemption windows, creating a structural challenge. 🤷 The Problem? A recent NAREIT study shows a 22% increase in NTR redemption requests, highlighting the difficulty NTRs face in meeting redemption demands without sufficient cash flow. ⏰ Why Now? CBRE revealed a 15% drop in office occupancy rates, highlighting negative real estate sentiment and potentially driving the 22% surge in NTR redemption requests. So, what does this mean? 🔎 BREIT faced significant redemption requests throughout 2023 and in 2024, but successfully fulfilled all requests in February, March and April of 2024. 🧐 SREIT's liquidity reserves dropped significantly, reaching a low of $752 million in April 2024, forcing them to tap a $1.3 billion unsecured credit line with limited remaining funds ($225 million). 💡Non-traded structures have created a liquidity mismatch - investors hold quarterly redemption options, but the underlying assets and sluggish CRE market make it difficult for firms to liquidate properties fast enough to meet demands. Reality or Market Jitters? BREIT and SREIT’s respective office exposures are a mere 3% and 7%, representing a miniscule amount of the PE giant’s NTR’s gross exposures. Likewise, both BREIT and SREIT boast 95% occupancy across all sectors - further highlighting the quality of the minimal office product within each firm's NTR vehicles. Recent liquidity challenges highlight a negative sentiment on commercial real estate, which has led to a bank-run-like panic from retail investors seeking to pull cash out. This sentiment mostly stems from higher interest rates and office woes: declining demand due to remote work trends, lower rents, rising vacancies, and refinancing difficulties for office owners with maturing loans on lower-quality properties. Redemptions more than likely stem from these negative headlines and a level of retail investor unsophistication of what they actually own. TLDR: BREIT and SREIT's minimal and strong performing office exposure positively positions them to navigate these challenges, although there are some lessons learned by the industry about this structure and the consequences of retail participation. While this issue likely won’t go away in the near term, I don’t see this issue mushrooming into a bigger catastrophe. While Blackstone’s Jon Gray may be biased, I agree with his quote from a recent interview: “the market has reached its nadir, and now is the opportune moment to buy.”

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📣 After months of negotiations, the New York State Legislature enacted on April 20 the state’s 2024-2025 Budget, which represents the most significant state action on housing in several budget cycles and includes provisions regarding the “Affordable Neighborhoods for New Yorkers” tax exemption (otherwise known as “485-x”) to incentivize new multifamily construction, the Good Cause Eviction Law, incentives for office-to-residential conversions, authorization for New York City to raise the Floor Area Ratio cap, and an increase in the allowance for Individual Apartment Improvements for Rent Stabilized Units, among others. This advisory by Katten's Affordable Housing and Community Development practice summarizes 485-x. #RealEstateLaw #NewYorkLaw #Budget #Housing

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📣 After months of negotiations, the New York State Legislature enacted on April 20 the state’s 2024-2025 Budget, which represents the most significant state action on housing in several budget cycles and includes provisions regarding the “Affordable Neighborhoods for New Yorkers” tax exemption (otherwise known as “485-x”) to incentivize new multifamily construction, the Good Cause Eviction Law, incentives for office-to-residential conversions, authorization for New York City to raise the Floor Area Ratio cap, and an increase in the allowance for Individual Apartment Improvements for Rent Stabilized Units, among others. This advisory by Katten's Affordable Housing and Community Development practice summarizes 485-x. #RealEstateLaw #NewYorkLaw #Budget #Housing

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If you are going to be there you should 1) let me know and 2) attend this panel!

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Great insight in the recently released DLA Global Real Estate Survey. Interest rates are driving both optimism and concern among CRE leaders as noted in the 2024 Annual State of the Market Survey. #CRE #realestate #commercialrealestate

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Case Study: Strategic Infill Development in Homestead, FL Overview This case study explores the acquisition and development of a vacant lot at 640 SW 10th Ave, Homestead, FL. We detail our approach to identifying promising infill opportunities, assessing feasibility, and designing a plan that maximizes returns while integrating with the neighborhood. Property Details Address: 640 SW 10th Ave, Homestead, FL 33030 Lot Size: 5,662.8 sq ft (50x109 ft, 50 ft frontage, no alley access) Current Listing: Vacant lot in a community with new homes, no HOA, marketed as "Build to suit" Parcel Number: 1078130540960 Listing Agent: Lasheriny Word, Word & Company Realty Listing Price: $130,000 Price per Sq Ft: $22.96 (typical for local infill lots under $25/sq ft) Market Analysis Neighborhood Characteristics Median Home Price (May 2024): $551,450 Homes Sold Last Year: 116 Average Days on Market: 46 days (indicative of a hot market) Year-over-Year Appreciation: 3.6% Average Sale Price vs. List Price: 97.7% Active Listings (June 2024): 23 homes for sale, priced $370,000 to over $1 million; only 2 under $600,000 Development Strategy Site Evaluation Zoning and Land Use: Verify current and future use, assess need for variances Confirm availability of utilities (preferably sewer and water) Neighborhood Consistency: Ensure new construction matches surrounding homes in size, style, and features (3 bed, 2 bath, 1-car garage, 1200-1300 sq ft) Financial Feasibility Land Cost Analysis: Listing Price: $130,000 Lot Price per Sq Ft: $22.96 (typical for local infill lots) Highest and Best Use: Propose variance for two attached townhomes (each approx. 1200-1300 sq ft, 3 bed, 2 bath) Projected Value: Approx. $900,000 for both townhomes Development Plan Rezoning and Variance Application: Prepare and submit applications, ensure compliance and expedite approvals Construction Management: Act as general contractors (pending in Miami), oversee construction, maintain budget and timeline Financial Modeling: Develop detailed financial projections for costs, revenues, and ROI Vertically Integrated Services Rezoning and Land Use Management Construction Financing Negotiation Call to Action We seek investors, partners, and contractors interested in South Florida's booming real estate market. With high demand and strategic planning, we aim to deliver profitable residential projects. Contact Us Rob Ellis Pink Development and Construction LLC 614-400-8762 rob@pink-construction.com

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Learn more about the new 485(x) and 467 (m) affordable housing production programs in Herrick's alert below.

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🧑‍⚖️Our latest GPNYC blog post - The Supreme Court: One Step Forward…About Three Steps Back Another term has ended, and the rulings have significant implications for Gray Panthers NYC's priorities. The overturning of the Chevron Doctrine and the weakening of the EPA are especially concerning. While there were a couple of positive rulings on abortion and gun control, most decisions are alarming. Our environment, women's health, and gun safety are all at risk. It's crucial to vote! The future of the Supreme Court is in our hands. Let's ensure we elect leaders who prioritize justice and equity. https://lnkd.in/eYcbUn6n #SupremeCourt #GrayPanthersNYC #VoteWisely #VoteForChange #EnvironmentalJustice #justice #equity

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Based on this article, Manhattan currently boasts 5.8% of all converted units in the US. In 2023, the number of apartments converted through adaptive reuse was nearly four times higher than in 2022. If you're a developer or office building owner looking to assess if your building is ready for conversion, DSA can offer expert assistance. Feel free to reach out via private message or text at 646-775-3484. #conversions #adaptivereuse #developmentsiyteadvisors

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