At the beginning of the New Year, we like to offer you a brief summary of the real estate market results for the previous 12 months. 2016 proved to be another successful year in residential real estate in the North Country (Clinton, Essex, and Franklin Counties) with dollar sales for residential properties up by 9% from 2015 to $238MM. The total number of houses sold in the 3 counties was also up 14.2% to 1254. More specific information by county is listed below.
Clinton County
Clinton County residential sales in 2016 were $91,278,231, up 12.6% from 2015, with the number of homes sold up 10.7% to 612. The average price of a home sold in 2016 in the County was $149,147 up slightly by 1.7% from 2015.
Essex County
Essex County had a large increase in residential sales, up 41% to $100,512,425. 308 homes were sold, 25.2% more than 2015. The average sales price of a home was up 12.6% to $326,339.
Franklin County
Franklin County had several major sales in 2015 that increased the residential sales dollars that year by 32%. Not surprisingly, 2016 sales have decreased -29.9% from that high. The average price of a home sold in 2016 was $138,469, contrasting with the previous year’s average of $220,498, reflecting those large sales.
Commercial & Investment Markets
The commercial and investment real estate markets in the North Country remained stable during 2016. The following is a summary of the primary real estate asset classes and special topics:
Retail
In general demand was stable in 2016 with minimal vacancies in the primary Route 3 shopping corridor. Investor demand for net leased properties remains strong with cap rates in the 6.5-8.5% range.
Downtown Plattsburgh
There is likely to be a positive impact on the Downtown real estate market within 12-24 months because of the NY State Downtown Revitalization Grant of $10MM received by the City. As a member of the Downtown Revitalization Initiative (DRI) Steering Committee, we are working with the Mayor, NY State and others to help the City maximize this opportunity. If you or anyone you know has an interest in Downtown Plattsburgh/waterfront development, please contact Neil Fesette.
Office
Demand for office space is fairly low and has been for an extended time frame. A majority of users are considered “B level” from an economic standpoint with cost comfort in the $10-$15 per square foot range. Because of this, our markets have seen minimal new construction of office buildings. Investor demand for office buildings is nearly isolated to users. Investor interest is low due to tenant credit quality and typical lease terms in the region.
Multi-Family
Vacancy rates have been 5% or less for an extended time period. Rents were stable throughout 2016. Supply and demand appear to be equal based on market time of vacant units. Investor demand for multi-family properties is strong due to low vacancy rates, stable rents and relative inexpensive debt to funds transactions.
Industrial
Vacancies are low in the region and rents are stable in the $4-$7/SF range. Demand for space was soft throughout 2016. Within the last 12-18 months there were several completed industrial buildings including Bombardier, Schluter Systems, and Nova Bus to name a few. The Chamber of Commerce and The Development Corporation continue their efforts to attract new companies to the area and promote the State’s StartUpNY initiative.
Norsk Titanium Facility
We have been providing Norsk with assistance for housing. Hopefully their new construction will begin soon and this will have a positive effect on the real estate market.