Fear of Flooding: Hurricane Sandy Still Dampens Lower Manhattan Real Estate, According to New Survey of NY Commercial Property Executives

Most Real Estate Execs Think Concerns About Flooding Continue to Decrease Appeal of Financial District Offices; Majority Not Confident Government Will Work to Lessen Future Disasters, According to Marks Paneth & Shron Survey

Marketwired

NEW YORK, NY--(Marketwired - Jul 24, 2013) - Nearly nine months later, Hurricane Sandy continues to wash away the luster of Lower Manhattan commercial real estate, according to the results of a new survey of over 100 New York commercial property executives conducted this summer by accounting firm Marks Paneth & Shron (MP&S).

"The insurance companies are the wild card here. The concern seems to stem less from the damage already done and more from the idea that it can happen again and that not enough will be done to prevent it," said William H. Jennings, Partner-in-Charge of the Real Estate Practice at MP&S.

Among the findings of the Marks Paneth & Shron Gotham Commercial Real Estate Monitor summer survey that puts commercial property professionals' views on Lower Manhattan in high relief:

  • The majority -- 63% -- of New York commercial property executives said they think the potential for flooding in Lower Manhattan will increase interest in commercial properties in other parts of the island less prone to flooding. Fewer than a quarter (24%) disagreed with that perspective. The rest weren't sure.

  • Only 43% of real estate executives are somewhat confident there will be a significant government effort to minimize the potential for future flooding in Lower Manhattan.

There is a brighter side to the findings. Fewer New York commercial real estate executives believe that commercial property values in Lower Manhattan will have been permanently lowered by the effects of Sandy than did at the beginning of the year. In the current summer survey, only 9% said values are permanently lowered, compared with 19% in the winter (January 2013) Marks Paneth & Shron Gotham Commercial Real Estate Monitor survey. And more executives -- 40%, compared with 26% in January -- now say there's no impact on property values because of Sandy.

Methodology
The Gotham Commercial Real Estate Monitor from Marks Paneth & Shron represents the findings of a survey of over 100 top commercial real estate professionals in the New York City market. They included owners and managers of commercial property, commercial real estate brokers and agents, and attorneys and accountants specializing in this sector. The inaugural survey was completed in January 2013. The research employed self-administered questionnaires completed online by respondents. The list of professionals surveyed was compiled by Marks Paneth and Shron LLP, the research sponsor. In addition, a link to the survey site was included in an online trade publication. Interviews were completed during the period of May 6 to July 1, 2013.

To receive a copy of the Summer 2013 Marks Paneth & Shron Gotham Real Estate Monitor and/or to survey with one of the MP&S leaders who fielded the survey, please contact Katarina Wenk-Bodenmiller of Sommerfield Communications, Inc. at Katarina@sommerfield.com or 212-255-8386.

About Marks Paneth & Shron LLP

Marks Paneth & Shron LLP is an accounting firm with over 500 people, of whom nearly 65 are partners and principals. The firm provides public and private businesses with a full range of auditing, accounting, tax, consulting, bankruptcy and restructuring services as well as litigation and corporate financial advisory services to domestic and international clients. The firm also specializes in providing tax advisory and consulting for high-net-worth individuals and their families, as well as a wide range of services for international, real estate, media, entertainment, nonprofit, professional and financial services, and energy clients. The firm has a strong track record supporting emerging growth companies, entrepreneurs, business owners and investors as they navigate the business life cycle.

The firm's subsidiary, Tailored Technologies, LLC, provides information technology consulting services. In addition, its membership in Morison International, a leading international association for independent business advisers, financial consulting and accounting firms, facilitates service delivery to clients throughout the United States and around the world. Marks Paneth & Shron LLP, whose origins date back to 1907, is the 32nd largest accounting firm in the nation and the 16th largest in the New York area. In addition, readers of the New York Law Journal rank MP&S as one of the area's top forensic accounting firms for the third year in a row.

Its headquarters are in Manhattan. Additional offices are in Westchester, Long Island and the Cayman Islands. For more information, please visit www.markspaneth.com

Contact:

Katarina Wenk-Bodenmiller
Sommerfield Communications, Inc.
(212) 255-8386
Katarina@sommerfield.com

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