100 Years of Commercial Real Estate Prices in Manhattan

15 Pages Posted: 27 Apr 2009

See all articles by William C. Wheaton

William C. Wheaton

Massachusetts Institute of Technology (MIT) - Department of Economics

Mark S. Baranski

Northeastern University School of Architecture; Massachusetts Institute of Technology (MIT) - Center for Real Estate

Cesarina A. Templeton

affiliation not provided to SSRN

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Abstract

This article is able to put together a database of 86 repeat-sales transactions for office properties in lower and midtown Manhattan spanning the years from 1899 to 1999. Using this very limited database, decade-interval changes in real property prices are estimated - with varying degrees of precision. Our conclusions are two fold. First, adjusting for inflation, commercial office property values were 30% lower in 1999 than they were in 1899. Second, within any decade values often rise and fall by 20-50% in real terms. With these results, the long-term historic return to New York commercial property must mostly comprise yield with capital gains limited to general inflation. Other historical studies consistent with this conclusion are reviewed.

Suggested Citation

Wheaton, William C. and Baranski, Mark S. and Templeton, Cesarina A., 100 Years of Commercial Real Estate Prices in Manhattan. Real Estate Economics, Vol. 37, No. 1, pp. 69-83, Spring 2009. Available at SSRN: https://ssrn.com/abstract=1395427 or http://dx.doi.org/10.1111/j.1540-6229.2009.00235.x

William C. Wheaton (Contact Author)

Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

50 Memorial Drive
E52-252B
Cambridge, MA 02142
United States
617-253-1723 (Phone)
617-253-1330 (Fax)

Mark S. Baranski

Northeastern University School of Architecture ( email )

Boston, MA 02115
United States

Massachusetts Institute of Technology (MIT) - Center for Real Estate ( email )

United States

Cesarina A. Templeton

affiliation not provided to SSRN ( email )

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