INSIDE THE DEAL: Apt. Property Sells Quickly in Market Where ‘Rents Can Only Increase’

By Keat Foong, Executive EditorWest New York, N.J.—Apartment properties appear to be still moving relatively well in some markets. One such market may be West New York, N.J., where a sale marketed by The Kislak Co., Inc. closed in three months. Under rent laws in Hudson County, owners can increase rents to market by initiating…

By Keat Foong, Executive EditorWest New York, N.J.—Apartment properties appear to be still moving relatively well in some markets. One such market may be West New York, N.J., where a sale marketed by The Kislak Co., Inc. closed in three months. Under rent laws in Hudson County, owners can increase rents to market by initiating capital improvements when residents vacate units. This offers the opportunity for an attractive value-add proposition with many of the apartment properties in the area. “The sale of these properties illustrates the continued strength of multifamily investment properties in both West New York and Hudson County,” explained Don Baxter, vice president at Kislak. “Unlike in some other areas, investors’ returns are guaranteed and continue to increase in Hudson County because of its unique rent control ordinances.  Hudson County is a rare area in northern New Jersey with below-market rents. As tenancies change, rents can only increase.” Baxter, and Jonathan Greenberg, vice president at Kislak, represented both buyer and seller recently in the $2.19 million sale of  401 53rd Street in Hudson County. The buyer intends to renovate the units and increase value. At the time of closing, the property was 100 percent occupied, says Kislak. The buyer’s financing was arranged by Elliot Treitel of Meridian Capital.  The law firm of Feinstein, Raiss, Kelin & Booker LLC represented the buyer.“There is a huge demand for good apartment buildings” in the market, and investor demand still exceeds the supply of assets for sale, according to Greenberg, who said the sale offer received “a lot” of bids. Demand from renters is also strong because of the high population density in the area, said Greenberg. “There is no vacancy issue in Hudson County because it is a very densely populated area,” added Baxter, who was Kislak’s 2008 Salesperson of the Year, and the company’s Rookie of the Year in 2007. According to Kislak, Greater Hudson County remains strong given the population and proximity to New York City.  West New York sits on the Hudson River across from New York City and is the third most densely populated municipality in the country.  Hudson County is the sixth-most densely populated county in the country, behind only four of five New of York City boroughs and San Francisco County, California. Greenberg, who was Kislak’s 2008 Producer of the Year, said the local buyers in the market include family owned companies, or former stock market investors who are turning to real estate.

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