Savvy Irish investors gobbling up NY property
HUNDREDS of shrewd Irish property investors are flocking to the land of opportunity to cash in on upmarket condominiums in midtown Manhattan.
Property experts are calling the current economic climate in the United States as "a landlord's dream", as agents sell off large blocks of luxury apartments to eager Irish investors.
International property companies are reporting that Irish buyers are spending an average of $750,000 each on apartments in Manhattan with some investing over $2 million in luxury condominiums.
America has dramatically risen on the index that tracks property investment opportunities.
Rents in New York are experiencing such a huge interest from Ireland's cash-rich investors that the property companies are jetting staff over to Ireland to meet Irish buyers hoping to take their own bite out of The Big Apple.
Anne Marie Moriarty from the Corcoran Group, the largest residential real estate firm in New York City, said her trips to Dublin and Belfast to meet with prospective buyers have been very productive. "The Irish have always believed that property is a good investment," says Corcoran, "and now they are looking for new frontiers. They are absolutely fearless when it comes to buying property here and with the euro strong against the dollar, it certainly makes New York a very attractive option."
Irish interest for property in New York has increased ten-fold, she says. "I've noticed that the Irish prefer to stay on the isle of Manhattan rather than invest in areas such as Queens and the Bronx as they feel it's not such a gamble. Manhattan is a sure thing because there's only so much land and there'll always be a huge demand for rental accommodation there."
"The rental return that you'd get for an apartment in Manhattan is substantially more than what you'd get for a comparable property in Dublin. For example, for an apartment in Manhattan you could get around €4,500 per month but you'd only get around €1,500 for a similar property in Dublin," says Cathal McGinley of Keane Mahony Smith.
His company, which has been selling properties for between $450,000 and $2 million to Irish buyers for the past four years, has recently taken a block of apartments in the Centria, a high-rise near the Rockefeller Centre, with the intention of selling them to Irish buyers.
"We're only closing Centria now and already over 80 apartments have been pre-let before people even close the sales," he says. "If that was Dublin, a buyer would close the sale first and then wonder where in God's name they were going to find a tenant."
His clients are the new monied Irish making their first investment abroad and want to do it in a "relatively safe market."
Niall McHenry, director of the new homes overseas department at Gunne auctioneers, says that the number of confident buyers his company sees making substantial investments in Manhattan property is an indicator of the strength of the marketplace. "Last year we marketed a top-class development in the Tribeca area in downtown Manhattan close to some of the city's top finance houses," says McHenry, "and only four or fives blocks from where they are building the new towers. The starting price was over $1 million each and the building even had its own pine forest on the roof.
"We sold a couple of those to Irish investors, some of who paid over $2 million for one of the luxury apartments. So you can see from the prices we're talking about that the people who are buying these are seriously savvy investors who know that they're dealing in a prime area because these apartments would command an excellent rent."
But he offers a word of caution. "I know that high rents can be achieved for properties in Manhattan," says McHenry, "but people hoping to invest there should look at the maintenance charges, ongoing costs and annual taxes before they make a decision."
Meanwhile, Jonathan J. Miller, President of Miller Samuel, a real estate consultant company in New York, says of the Irish invasion: "The amount of interest is absolutely phenomenal. I've never seen anything like it before."