Tuckahoe, New York is located about 20 miles from Midtown Manhattan. According to Mapquest, you can drive there in about 35 minutes (although that's probably at 2am with no traffic) or you can take the train from Grand Central in a guaranteed 30 minutes. That's less time than it takes to get from Midtown to Coney Island by subway.
Many real estate investors say they'll only buy in “their own backyard,” so they can keep an eye on their investment. This begs the question: Do New York City owners look to buy in the suburbs?
Our office is active in Westchester, as well as Long Island. We've handled close to 50 sales in Westchester over the last five years. I asked John Barrett, one of our top Westchester sales agents, this question.
Barrett says that it depends on the deal size and the product type. For a core retail deal, a well-located Westchester asset can not only draw interest from New York Metro area owners, but also from a national audience. Meanwhile, smaller multifamily properties, development sites, and mixed-use properties with non-credit tenants are generally sold to existing Westchester owners.
Many times, the buyer owns in New York City, but lives in Westchester. Such a buyer emerged in our recent sale at 33 Main Street in the Village of Tuckahoe, NY. This retail property, located at the intersection of Main Street and Columbus Avenue, sold in an all-cash transaction valued at $3,050,000.
The single-story, 10,500-square-foot property was fully leased by the United States Post Office, a gourmet deli, and a local retailer. The property, which is in excellent condition, benefits from being located on a highly visible corner and directly across the street from the Metro-North Train Station, Starbuck's, and a Carvel. The transaction occurred at a capitalization rate of 5.7% and sold for $290 per square foot
According to Barrett, our firm received 15 offers for the property, of which two were from national buyers, six were local buyers, and six were from New York City buyers. The property was ultimately sold to MAGJ Realty LLC, a large New York City owner, who was represented by Mark Fonte of Tri-Font Realty.
Thus, it's fair to say that there's still competition from New York City and even national buyers for prime assets in the New York Metro Area. This might not bode well on the buy side, but it is certainly a consideration when looking at options for a future sale.