Subject: Is New York's luxury property market dissolving or evolving?
From: Mercedes Berk <[email-masked]>
To: <[email-masked]>
Date: Sat, 14 May 2016 11:03:05 +0000

Economics, taxation, and political priorities continue to be the driving force influencing the world's prime residential markets. According to the Knight Frank Wealth Report (http://content.knightfrank.com/research/83/documents/en/wealth-report-2016-3579.pdf), the impact of rising interest rates will have a strong effect on buyer sentiment and ultimately sales volume, despite the Federal Reserves cautious outlook. The transition in the U.S. policy to higher rates is likely to be emulated by other high performing global economies.

Despite any slowdown or economic jitters, the U.S. and more specifically New York will remain a largely attractive global market. Recently, demand in the Manhattan's luxury sector has slowed while demand remains strong for a more limited supply of moderately priced units. The slowdown in the luxury sector has been fueled by an unprecedented supply of new development inventory chasing markets and economic conditions that existed over the past few years.

Realizing the supply glut, parties involved in a number of high-profile luxury developments have either cancelled or shelved plans for their projects. This is a good sign for overall market health and will likely help correct a temporary imbalance between supply and demand in the luxury segment as existing supply is absorbed over the next few years. Pricing expectations in existing projects currently under construction will likely be adjusted to meet the market, and as always, a select number of standout projects will continue to set the pace.

We feel Manhattan's luxury market isn't dissolving, but rather evolving as it adapts to both local and global conditions. As it is with all things, challenges create opportunity and savvy purchasers understand that this could be the best time to make an investment based on the prospects presented by current market conditions – more choices, realistic pricing, greater value, and a higher return on investment in the long-term.

We'd be happy to share our recommendations on Manhattan's best new developments, and of course, we are always available to help or advise you on any real estate matters in the United States or overseas. As always, if you have any questions or just want to talk real estate, please don't hesitate to give us a call.

Warm regards,

Noel & Liz

Noel Berk, Principal

+1 212-371-4065 tel:2123714065 | [email-masked]

Elizabeth Omedes, Principal

+1 917-371-0075 tel:9173710075 | [email-masked]

ENGEL & VÖLKERS - MERCEDES/BERK

783 Madison Avenue, 3rd Floor, New York, NY 10065 | 212.452.3070 tel:2124523070 | mercedesberk.com http://mercedesberk.com

All information furnished regarding property for sale, rental or financing is from sources deemed reliable, but no warranty or representation is made as the accuracy thereof and same is submitted subject to errors, omissions, change of price, rental or other conditions, prior sale, lease or financing or withdrawal without notice. All information contained herein is preliminary. Sponsor is awaiting approval of offering plan from New York State Attorney General. This is not a solicitation for sale, and is for informational purpose only. Sponsor reserves the right to make changes in accordance with the Offering Plan upon completion. All dimensions and illustrations are approximate. All images are artist renderings. Only the offering plan, upon its approval by the New York State Attorney General will provide floor plans, dimensions, and opening prices.

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