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Multifamily Month In Review: New York City

November 2011 Multifamily Transaction Overview Featuring Trailing Six Month Analysis: June - November 11 + Up-To-Date Multifamily Market Indicators By Ariel Property Advisors

Released January 2012

Ariel Property Advisors is pleased to present its Multifamily Month In Review: New York City. The report provides a monthly overview of market activity, benchmark transactions, revenue and expense trends, and current events that affect the multifamily real estate market. The Multifamily Month In Review is distributed to our clients on a monthly basis. Past versions of the Multifamily Month In Review can be found at http://arielpa.com/research/reports/.

Table Of Contents New York City Multifamily Month In Review Month To Month Performance Comparison Trailing Six Month Analysis Pricing Indicators Trailing Six Month Performance Comparison Transaction & Dollar Volume Trailing Analysis Macro-Economic Overview & Market Fundamentals NYC Sub-Market Overview Manhattan Northern Manhattan Brooklyn The Bronx Queens
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About Ariel Property Advisors

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Multifamily Month In Review: New York City

Ariel Property Advisors

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Multifamily Month In Review: New York City

Dear Friends: November 2011s multifamily sales activity remained steady from Octobers modest levels. For the month, there were 40 transactions comprised of 51 buildings totaling just over $250 million in gross consideration. Compared to October 2011s 28 transactions comprised of 50 buildings totaling $256.16 million in gross consideration, Novembers figures reflect only a 2% increase in the number of buildings sold and a 2% decrease in dollar volume, but a lack of portfolio transactions led to a transaction volume increase of 43%. These figures also represent a steady 3% increase in transaction volume and a 47% decrease in dollar volume compared to November 2010, which saw 39 transactions totaling $475 million in gross consideration. It should be noted, however, that the vast majority of November 2010s activity was a result of two major portfolios trading for approximately $300 million in total gross consideration. Manhattan led the way with a strong rebound from a lackluster month of sales in October, posting 16 transactions comprised of 24 buildings worth $130.827 million in gross consideration. This is more than double the amount of sales that took place in October and makes up more than 50% of Novembers total figures. This is the second month in a row where there were no sales in Manhattan valued north of $20 million. Brooklyn was the second most active sub-market and improved significantly from light October numbers. For the month, the borough posted 13 transactions consisting of 14 buildings totaling $57.17 million in gross consideration. Activity in The Bronx declined from a very strong October but figures were still impressive nonetheless. The borough had 4 transactions consisting of 4 buildings totaling $28.536 million in gross consideration. Queens and Northern Manhattan were among the least active for November. Queens had only 2 transactions consisting of 3 buildings totaling $17 million in gross consideration and Northern Manhattan showed a steady 5 transactions consisting of 6 buildings totaling $16.625 million in gross consideration. While December typically yields a flurry of year end closings, if this more modest level of activity holds it could be an indication that buyers are acting more cautiously to rising asking prices by sellers. That said, owners may be justified in holding out for higher levels as the unemployment rate trends down, economic fundamentals show more consistent improvement and rents continue to rise. Trailing 6-Month Sales Averages: For the six months ended in November (page 8), average transaction volume increased slightly to 35 transactions per month. It is notable that this is the highest 6-month average since May 2011. The 6-month average for dollar volume came in at $404.83 million, a slight $16 million increase from Octobers average. Warmest Regards,

Shimon Shkury Investment Sales: Michael A. Tortorici Victor Sozio Jonathan Berman Scot Hirschfield Jesse Deutch Investment Research: Ivan Petrovic Aryeh Orlofsky Dwan Daniels Billy Papayiannis Dusan Panic

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Multifamily Month In Review: New York City

Multifamily Market Performance By District Nov 11 | Oct 11 | Nov 10 | Comparison

Metrics
Manhattan Transaction Volume Building Volume Dollar Volume Total Units Transaction Volume Building Volume Dollar Volume Total Units Transaction Volume Building Volume Dollar Volume Total Units Transaction Volume Building Volume Dollar Volume Total Units Traded Transaction Volume Building Volume Dollar Volume Total Units Traded

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Nov 2011
16 24 $130,827,001 460 5 6 $16,625,000 124 4 4 $28,536,700 335 13 14 $57,171,073 278 2 3 $17,000,000 144

% Change Nov-Oct11 100% 167% 111% 135% 25% 0% -68% -74% -43% -84% -70% -70% 86% 75% 45% -13% 0% 50% 188% 125%

Oct 2011
8 9 $62,000,000 196 4 6 $52,276,342 478 7 25 $96,640,076 1,133 7 8 $39,346,000 318 2 2 $5,900,000 64

% Change Nov11-Nov10 129% 200% -48% -36% 67% 50% -13% -30% -80% -91% -83% -87% 160% 133% 204% -4% -50% -25% 1% -10%

Nov 2010
7 8 $253,375,000 722 3 4 $19,116,177 178 20 44 $167,006,277 2,495 5 6 $18,819,567 291 4 4 $16,800,000 160

Transaction & Dollar Volume Graphs

Dollar Volume Comparison Graph

Manhattan Brooklyn N. Manhattan Queens The Bronx

Northern Manhattan

$400m $300m $200m

The Bronx

$100m $80m $60m $40m $20m

Brooklyn

Nov 11

Oct 11

Nov 10

Queens

Building Volume Comparison Graph

Manhattan Brooklyn N. Manhattan Queens The Bronx

44

25

All NYC

Transaction Volume Building Volume Dollar Volume Total Units

40 51 $250,159,774 1,341

43% 2% -2% -39%

28 50 $256,162,418 2,189

3% -23% -47% -65% Building Volume Comparison Graph

39 66 $475,117,021 3,846

20 15 10 5

Dollar Volume Comparison Graph Manhattan* Northern Manhattan 7% Brooklyn

The Bronx 8%

Queens

Nov 11

Oct 11

Nov 10

Transaction & Dollar Volume Graphs

6%

11%

6%

10%

*Manhattan sales figures are derived from properties that traded below 96th Street on the east side and below 110th Street on the west side

23% 53% 49%

27%

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Multifamily Month In Review: New York City

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Trailing Six Month Analysis Introduction

Trailing Six Month Analysis Methodology

Given the commercial real estate industrys cyclical nature and relatively small number of sample properties that trade in any month or quarter, Ariel Property Advisors developed the Trailing Six Month Analysis as a unique research tool for identifying multifamily sales trends in New York City. The Trailing Six Month Analysis includes charts for the most recent six month period that detail the average price per unit, average price per square foot, average cap rate, average gross rent multiplier, and total transactions and prices for multifamily properties in Manhattan (below 96th Street), Northern Manhattan (north of East 96th Street, east of Fifth Avenue, north of 110th Street and west of Fifth Avenue), The Bronx, Brooklyn, and Queens. Sales figures from neighborhoods that had transactions during the six month period also are highlighted. The multifamily transactions included in the analysis occurred at a minimum sales price of $1 million, with a minimum gross area of 5,000 square feet and with a minimum of 10 units. Public records were used to compile the report figures, which were reported by ACRIS and other sources deemed reliable.

Trailing Six Month Moving Averages: Jun 2011 - Nov 2011

Pricing Indicators
Location Manhattan (below 96th St.) Northern Manhattan Bronx Brooklyn Queens Avg. $ / Unit $415,467 $131,264 $82,485 $141,193 $143,636 Avg. $ / SF $520 $158 $95 $162 $176 Avg. Cap Rate 5.43% 6.96% 7.67% 6.47% 5.77% Avg. GRM 11.19 8.49 6.89 11.70 9.91

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Multifamily Month In Review: New York City

Trailing Six Month Performance: Jun - Nov | 2010 vs. 2011 Comparison

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2011 Six Month Trailing Numbers

Location Manhattan (below 96th St.) Northern Manhattan Bronx Brooklyn Queens Summary Total Transactions 86 30 65 68 19 268 Total Buildings Traded 123 39 86 79 20 347 Total Dollar Value Traded $1,942,913,055 $178,283,507 $290,319,082 $306,035,087 $90,233,538 $2,807,784,269 Median Price $7,900,000 $3,262,500 $3,141,667 $2,475,000 $2,750,000 $19,441,667 Total Units Traded 3,944 1,479 3,618 2,334 662 12,037 Median Units / Transaction 23 28 43 23 17 134

2010 Six Month Trailing Numbers

Total Transactions 47 27 70 43 23 210 Total Buildings Traded 50 35 96 44 23 248 Total Dollar Value Traded $618,705,679 $139,623,881 $431,618,333 $156,206,171 $613,788,932 $1,959,942,996 Median Price $4,250,000 $4,400,000 $3,549,738 $2,262,500 $2,700,000 $17,162,238 Total Units Traded 2,054 1,252 5,691 1,537 1,061 11,595 Median Units / Transaction 18 36 51 24 20 149

Transaction Summary

Pricing Distribution Transaction Volume

Location / Criteria Manhattan (below 96th St.) Northern Manhattan Bronx Brooklyn Queens

2011 Transaction Volume as a percentage of total volume $20mm & up 18% 7% 3% 4% 0% $5mm - $20mm 47% 28% 20% 18% 32% $1mm - $5mm 34% 66% 77% 78% 68%

2010 Transaction Volume as a percentage of total volume $20mm & up 9% 0% 7% 0% 4% $5mm - $20mm 38% 48% 21% 23% 30% $1mm - $5mm 53% 52% 71% 77% 65%

Pricing Distribution Dollar Volume

Location / Criteria Manhattan (below 96th St.) Northern Manhattan Bronx Brooklyn Queens

2011 Dollar Volume as a percentage of total volume $20mm & up 74% 36% 23% 31% 0% $5mm - $20mm 21% 34% 36% 27% 66% $1mm - $5mm 5% 30% 41% 42% 34%

2010 Dollar Volume as a percentage of total volume $20mm & up 62% 0% 38% 0% 82% $5mm - $20mm 26% 76% 30% 54% 12% $1mm - $5mm 12% 24% 32% 46% 6%

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Multifamily Month In Review: New York City

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Six Month Trailing Analysis Transaction & Dollar Volume

Legend: Transaction Volume Dollar Volume

Multifamily Transaction Timeline

Month By Month Comparison: June 2010 - November 2011

114-30 East 104th St sells for 18.5mm making it the largest single 2010 Nothern Manhattan multifamily trade 25-21 31st Ave. sells for $12.625mm, the largest Queens multifamily transaciton in 2010

Vacant unsold condominium buildings sell at 1961-67 7th Avenue in NM for $19.5mm and 142-46 North 6th Street in Brooklyn for $15.25mm

Macklowe purchases $70mm Lenox Hill building Harbor Group takes control of $31mm distressed Vantage portfolio

Institutional investor sells Northern Manhattan multifamily portfolio in excess of $60mm

2301 Kings Highway trades for $14.05mm, making it the largest Brooklyn multifamily to sell in 2010

$700mm $600mm $500mm $400mm $300mm $200mm $100mm Jun

750 East 179th Street & 730 Oakland Place trade for $23.5mm, making it the largest Bronx transaction in 2010

Bronx Multifamily portfolio restructured for $75.89mm

255-unit portfolio of Washington Heights & Bronx properties sells for $22.5mm

11-building Bronx portfolio Touro College sells Group buys fetches $47mm | mixed-use building on Carnegie Hill Lionel Hampton W. 85th St. for $13mm rental building Houses in Harlem for $105mm UDR buys RiverFosterlane trades for $32.5mm gate complex in Kips Management Bay for $443mm Corp. acquires Stone Street 265-unit UWS luxury MackProperties apartment building lowe buys acquire $90mm for $140mm 737 Park UES portfolio Ave for 245-10 Grand $253mm Central Pkwy S sells for $57.75mm

Criterian sells The Astoria luxury rental building in LIC for $42.5mm Cheshire

7 Harrison Street in Tribeca trades for $600psf | Avalon Bay purchases Brooklyn building for $23mm

105 90 75 60 45 30 15

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Economic Events of 2010

Economic Events of 2011

Gross domesRepublicans take tic product, was back House of Reprerevised lower sentatives and advance in Senate. Andrew White House to an annual growth rate of Cuomo becomes announces governor of NY, Repub- bi-partisan tax 2.8% in the three months ending in licans rebalance state compromise December govt houses extending all Bush tax cuts for NYS unem2 years, including ployment rate the 15% capital drops by 20 basis gains tax points, the largest decline since 2004 U.S. housing prices declined again in the first three months of 2011 | Hiring slowed in May with only 54,000 jobs added NYS economy adds 13,600 private sector jobs New York State legislators reached a deal on rent laws | Foreclosure filings in NYS 30-year bond have dropped 85 % since declined 61 September | New York basis point from District economy expands, 3.51% to 2.9% but at slower pace NYS Labor Department reported the state added 14,100 private sector jobs | Construction permits for new buildings, alterations & demolition increased by about 12% 6 Months Ended 2010 Nov Dec 2011 Jan Feb U.S. unemployment rate falls to 9.0% | Conference Board report shows improving U.S. economy | Reports show real estate market improving nationwide

Economy adds 431,000 jobs in May, mostly related to the 2010 Census

U.S. Federal Reserve buying Government debt in effort to maintain low interest rates | Home sales at lowest level in 10 Years

Real GDP increases 2.5 Percent | Mortgage rates hit record lows | Manhattan accounts for 80% of multifamily dollar volume in Q311 Avg. Transaction Vol. 32 34 35 34 38 37 35 30 32 32 33 32 35

The Trailing 6-Month Moving Average

Legend: Transaction Volume Dollar Volume

Avg. Dollar Vol. $223,725,999 $257,631,308 $261,864,472 $258,987,899 $260,263,626 $284,193,244 $245,060,615 $246,026,657 $325,460,447 $381,297,547 $416,195,948 $388,676,505 $404,863,984

November 2010 - November 2011

$400mm $350mm $300mm $250mm $200mm $150mm

$100mm

50 45 40 35 30 25
20

Mar Apr May Jun Jul Aug Sep Oct Nov

ec

ov

Ju l A ug

Ja

Ju

Fe

Se

ov

ct

2010

2011

Average monthly dollar volume and transaction count for given month and five months prior

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Midtown West

$2374

3119 2048

4235 2900

5260 3495

3747 2535 3262

November Average $1940 October Average % Change $1989 -2%

2647 2690 -2%

3724 3715 0%

4947 4971 0%

3315 3341 -1%

Morningside Heights $1698

Murray Hill $1983 3024 3561 4479 Multifamily Month In Review: New York City

Macro-Economic Overview Unemployment|Financing|Revenue|Expenses

VACANCY SUMMARY: 11/11
SoHo/TriBeCa NEIGHBORHOOD VACANCY RATE 1.42% 0.85% 0.97% 0.89% NEIGHBORHOOD BPC / Financial Dist Chelsea Upper East Side East Village/LES
Unemployment:

VACANCY RATE

Ariel Property Advisors 0.44%

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1.11% 1.34% 0.84%

Upper West Side West Village Rental Market / Vacancy:

Gramercy

The New York State (NYS) Labor Department reported an unemployment1.30%of 8% seasonrate Midtown East ally adjusted for November. After dipping 10 basis points in October, the rate regressed to Midtown West the 8% level, which had been maintained from July to September of this 1.60%NYS reported year. gaining 34,400 private sector jobs in November 2011. In the past two years NYS has recouped Murray Hill 0.94% 61% or 202,700, of the private sector jobs lost during the 2008-2009 recession. At the state level, unemployment levels have remained fairly stagnant; however, New York City (NYC) levels have seen a steady increase since April. The November unemployment rate increased yet again for NYC and is now up 10 basis points from 9.0% in October to 9.1% (not seasonally adjusted).
Unemployment Rate History NYS (Seasonally Adjusted) & NYC (Not Seasonally Adjusted) BLDG CLASSIFICATION

1.16% TheNovember Overall Vacancy rate for Manhattan was at 1.16% as November rental vacancy reported by Citi Habitats. This is slightly lower than the October rate of October Overall Vacancy 1.18% 1.18%. From June to October Manhattan rental vacancies had been on a steady incline; however, now the vacancy rates have begun to Difference -.02 stabilize. Additionally, for the month, rental rates have decreased by 2% for studios and one bedrooms and remained unchanged for two and three bedroom units.
Manhattan Rental Vacancy Rates Monthly Percentage Change
2.50%

OVERALL BLENDED AVERAGES: 11/11

STUDIO $2900 $2507 $2148 1905 1BR 3968 3608 3085 2598 2BR 5917

MANHATTAN RENTAL VACANCY RATES: 11/11

3BR
12.5%

New Development w/ DM* Doorman Elevator*** Walkup**

7981
1.25%

1.29

1.34

1.26

0.94

0.69

0.86 0.69
July

4124 3489
8%

5509
7.5%

0%
Nov Dec Jan Feb Mar Apr May

Jun

Aug

Sept

Oct

Nov 11

4628

Source: Citi Habitats

Expenses: * New Developments include all rental and condo buildings built after 2004. **Walkup averages include brownstone and townhouse rentals. 5% ***Elevator averages in the downtown neighborhoods include a significant number of loft rentals compared to other neighborhoods.

2003

2004

2005

2006

2007

2008

2009

2010

2.5% 2011 2012 Source: NYS Dept Of Labor

The December price of home heating oil dropped 5.9 cents from the November rate of 414 cents per gallon to 408.1 cents per gallon of No. 2 oil. Residential electricity rates for November decreased by 8 basis points to 15.2 cents per kilowatt hours (KWH) from the October rate of 16 cents per KWH.
Residential Electricity Rates Regional - Middle Atlantic (Cents / KWH)

Financing: Treasury rates exhibited a healthy increase across the board for the month. The December 30-year bond was up 13 basis points from 2.99% in November to 3.12%, while the December 10-year note was up 10 basis points from the November rate of 2.01% to 2.11%. The 5-year note showed increases from 0.9% in November to 0.97% in December. The 1-year T-bill was slightly lower in December at 1.2% from the November rate of 1.1%.

20

17.5

15

12.5

Treasury Yield Curve Rates 30-year | 10-year | 5-year | 1-year

6%

2007

2008

2009

2010

2011

2012

10

Source: US EIA Home Heating Oil Prices Monthly Average (cents per gallon)
500

4%

2%

400 300 200 100

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

0%
2006 2007 2008 2009 2010 2011 2012

Source: US Treasury Dept.

Source: NYSERDA

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9.1% 10% 5097 6702

1.18

0.99

1.00

1.08

1.18

1.16

Manhattan (below 96 th Street) After a lackluster October, multifamily sales activity more than doubled in November. For the month there were 16 transactions covering 24 buildings and totaling more than $130.827 million in gross consideration. It is worth noting that for the second month in a row there were no sales over $20 million, a change from earlier in the year when large institutional sales accounted for a significant portion of multifamily activity. The Upper East Side had a particularly active month with 6 transactions taking place. Included in them is 135 East 93rd Street, home of the popular Ottomanelli NY Grill, on Lexington Avenue. The 12 unit mixeduse walk-up building sold for $9.5 million, which represents $711 per square foot. In Little Italy, the Kalikow Group made their first NYC acquisition in 20 years buying 113-17 Elizabeth Street. The 27,800 square foot walk-up building sold for $12.6 million, which represents $454 per square foot. 2011 Notable Transactions:

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NYC Sub-Market Overview: Manhattan (below 96 th St.) 1

1 2 3 4 5 6 7 8 9 10

Jan 2011 | $48mm | 101 West 87th Street | 95 Unit Columbus Park sold through forclosure Mar 2011 | $13mm | 521-27 Amsterdam Ave | Mixed-Use building owned by Touro College Apr 2011 | $139mm | 601 Amsterdam Ave | 265-unit luxury Sagamore apartment building Apr 2011 | $122.5mm | 286-92 3rd Ave | 32 story luxury rental Elektra acquired by Investco Jun 2011 | $105mm | 1327-1329 Lexington Avenue | Cheshire Group buys Carnegie Hill rental Jun 2011 | $70mm | 150 East 72nd Street | Macklowe purchases Lenox Hill building Jul 2011 | $443mm |606 First Avenue | UDR buys Rivergate complex in Kips Bay for $443 million Aug 2011 | $253mm |737 Park Avenue | Macklowe purchases 21-story building at East 71st Street Sep 2011 | $90mm |Icon Realty Portfolio | Stone Street Properties acquires 241 units from Icon Realty Mgmt Nov 2011 | $20mm |7 Harrison Street | Corner mixed-use loft building in TriBeCa trades for $600psf

Manhattan Jun-Nov 2011 By Property Type

Property Type Elevatored Building Mixed-Use Building Walk-Up Building Portfolio Total Dollar Value Traded $260,474,454 $1,236,685,730 $206,254,235 $239,498,636 $1,942,913,055 Total Transactions 11 41 27 7 86 Total Buildings Traded 12 51 32 28 123 Total Units Traded 568 2,096 676 604 3,944

Average $ / SF $474 $531 $543 $484 $524

Average $ / Unit $412,861 $462,165 $355,909 $402,618 $417,653

Total / Average

Manhattan Jun-Nov 2011 By Neighborhood

Location Total Dollar Value Traded $22,800,000 $160,344,454 $3,800,000 $33,968,644 $19,738,000 $20,850,000 $29,700,000 $5,450,000 $145,029,400 $443,403,000 $16,475,000 $19,886,835 $19,308,702 $69,661,000 $77,554,992 $709,093,028 $72,100,000 $17,225,000 $38,000,000 $4,025,000 $14,500,000 $2,275,000 $1,942,913,055 Total Transactions 2 4 1 5 4 2 2 1 12 1 2 5 2 4 2 22 10 2 1 1 1 1 86 Total Buildings Traded 3 6 1 8 4 3 2 1 14 1 4 8 2 4 7 37 12 2 1 2 1 1 123 Total Units Traded 77 325 17 152 75 40 46 67 397 707 52 98 37 156 107 1,215 168 52 105 19 32 10 3,944

Average $ / SF $405 $492 $422 $362 $464 $333 $561 $96 $612 $531 $438 $315 $537 $606 $480 $563 $664 $551 $463 $535 $384 $180 $524

Average $ / Unit $258,730 $302,161 $223,529 $218,927 $252,085 $687,798 $762,778 $81,343 $401,677 $627,161 $297,917 $204,191 $506,543 $394,676 $700,245 $505,031 $502,750 $330,804 $361,905 $211,842 $453,125 $227,500 $417,653

Alphabet City Chelsea Chinatown Clinton

East Village Fashion Flatiron Gramercy

Greenwich Village Kips Bay Little Italy

Lower East Side Midtown West Murray Hill

TriBeCa Upper East Side Upper West Side

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SoHo Civic Center Midtown East Financial District Manhattan Valley

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Total / Average

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Northern Manhattan November transaction volume remained steady with 5 transactions consisting of 6 buildings but dollar fell significantly to $16.625 million. One notable transaction was the sale of 280 Manhattan Avenue, a 10-unit walk-up building located directly across the street from Mount Morris Park that was sold by our company. Despite the fact the building needed significant rehabilitation in several units, the property sold for $180 per square foot and $227,500 per unit with its $2.275 million price. Our company also closed the sale of 1804 Third Avenue, a 9-unit mixed-use walk-up building in East Harlem for $1.85 million. This property also needed some repair and had several units vacant, but achieved approximately $217 per square foot, reflecting the properties excellent retail potential. 2011 Notable Transactions:

NYC Sub-Market Overview: Northern Manhattan

1 2 3 4 5

Jan 2011 | $22.25mm | 10 building portfolio | 239 units and 25 stores Feb 2011 | $19.5mm | Lotta Condominiums - 159 West 118th Street | Acquired by Gaia Real Estate Mar 2011 | $14mm | 192-206 Dyckman Street | Parkoff Org. buys three adjacent mixed-use buildings Jun 2011 | $7.1mm | 500 Ft. Washington St. | 44,295 SF, 56 apartments & 1 retail unit, $161 PSF Jul 2011 | $31.32mm | Esquire Portfolio | Harbor Group International & Jadam Equities acquire 4 rent regulated buildings in Hamilton Heights containing 214 units 6 Sep 2011 | $6mm | 666 West 162nd Street| Gatsby Enterprises sells 49 apartments; $120k/unit 7 Oct 2011 | $31.5mm | Lionel Hampton Houses| Schron sells former Mitchell-Lama Harlem complex for $31.5mm

N. Manhattan Jun-Nov 2011 By Property Type

Property Type Elevatored Building Mixed-Use Building Walk-Up Building Portfolio Total / Average Total Dollar Value Traded $35,365,000 $30,262,165 $26,365,000 $86,291,342 $178,283,507 Total Transactions 6 10 9 5 30 Total Buildings Traded 7 10 9 13 39 Total Units Traded 288 244 195 752 1,479 Average $ / SF $149 $170 $163 $138 $158

Average $ / Unit $127,041 $127,180 $150,089 $129,859 $134,472

N. Manhattan Jun-Nov 2011 By Neighborhood

Location Central Harlem East Harlem Hamilton Heights Washington Heights West Harlem Morningside Heights Total / Average Total Dollar Value Traded $58,279,165 $10,868,000 $52,596,342 $45,915,000 $8,350,000 $2,275,000 $178,283,507 Total Transactions 8 5 4 10 2 1 30 Total Buildings Traded 10 5 9 12 2 1 39 Total Units Traded 579 91 353 377 69 10 1,479 Average $ / SF $168 $184 $156 $132 $184 $180 $158

6
Average $ / Unit $131,634 $131,250 $152,895 $124,423 $120,756 $227,500 $134,472

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The Bronx After a very active October, Bronx multifamily sales dipped in November. For the month there were 4 transactions covering 4 buildings worth approximately $28.536 million in gross consideration. Whereas the previous months sales were largely made up of portfolios, these were all single assets. Prices however continue to show excellent improvement. 2676 Grand Concourse, a 72,500 square foot walk-up building sold for $6.6 million, which translates to $91 per square foot and $81,481 per unit. 3940 Bronx Boulevard, a 92-unit elevatored building in Williamsbridge sold for $8.75 million, representing an impressive $104 per square foot at $95,109 per unit. 2011 Notable Transactions:

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NYC Sub-Market Overview: The Bronx 1

1 2 3 4 5 6 7 8 9

Jan 2011 | $6mm | 1135 Boynton Ave | Six story elevatored building trades for 6.7 GRM Jan 2011 | $5.55mm | 1104 Carrol Street | Five story walk-up building trades for 7.6 GRM Feb 2011 | $28.5mm | 2160, 2180 & 2181 Wallace & 2181 Barnes Ave | 276 Units trades for 8.61 GRM Apr 2011 | $27.75mm | Milbank Portfolio | 10 building portfolio acquired by Finkelstein Timberger LLC Apr 2011 | $4.65mm | 1901 Grand Street | Six story elevator building with 57 Units Jun 2011 | $15.5mm | Three apartment buildings; 175 units total; $15.5mm Sep 2011 | $15.3mm | 750 Pelham Parkway S | 139 units total; $15.3mm Oct 2011 | $46.8mm | Sheridan Avenue Portfolio | 11-building Bronx portfolio fetches $47M Oct 2011 | $21.15mm | Carpenter Avenue Portfolio | 5 Building Williamsbridge portfolio trades for 7.5 GRM

Bronx Jun-Nov 2011 By Property Type

Property Type

Total Dollar Value Traded $65,180,419 $75,828,367 $89,290,296 $60,020,000 $290,319,082

Total Transactions 15 19 29 2 65

Total Buildings Traded 15 23 33 15 86

Total Units Traded 823 957 1,130 708 3,618

Average $ / SF $81 $84 $111 $78 $95

Average $ / Unit $71,829 $82,570 $88,037 $81,096 $82,485

Elevatored Building Mixed-Use Building Walk-Up Building

Portfolio Total / Average

Bronx May-Oct 2011 By Neighborhood

Location Bathgate Bedford Park Total Dollar Value Traded $2,649,605 $39,154,214 $5,329,832 $5,077,111 $7,998,031 $13,140,000 $14,424,812 $16,420,471 $6,900,000 $60,080,000 $12,500,000 $10,858,888 $36,917,313 $33,450,000 $15,300,000 $4,420,000 $2,298,805 $3,400,000 $290,319,082 Total Transactions 2 11 3 2 5 4 4 4 2 6 4 3 6 3 1 3 1 1 65 Total Buildings Traded 2 11 3 2 5 4 4 4 2 16 8 3 9 7 1 3 1 1 86 39 519 81 64 110 204 133 157 86 749 200 133 473 410 139 36 40 45 3,618

Total Units Traded

Average $ / SF $74 $77 $103 $92 $102 $76 $138 $102 $71 $77 $63 $68 $97 $88 $92 $235 $135 $84 $95

Average $ / Unit $69,570 $80,392 $72,319 $79,330 $73,928 $63,332 $134,848 $99,648 $80,337 $74,455 $61,772 $74,624 $79,352 $78,534 $110,072 $122,778 $57,470 $75,556 $82,485

Belmont Castle Hill East Tremont

Fordham Highbridge Kingsbridge Kingsbridge Heights

Melrose Morrisania Mount Hope

Soundview Williamsbridge Pelham Parkway Riverdale Mott Haven Westchester Square Total / Average

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Brooklyn Brooklyn multifamily transactions increased significantly from October to November. The borough saw 13 transactions consisting of 14 buildings over $57.17 million in gross consideration. Notable sales for the month include 250 Pacific Street in Boerum Hill and 59 7th Avenue in Park Slope. The first was a 17,000 square foot walk up building containing 25 units. The property sold for $4.4 million, which represents $256 per square foot and $176,000 per unit. 59 7th Avenue is a corner mixed-use walk-up building that sold for $2.675 million, which represents an impressive $495 per square foot and $267,500 per unit - much of this price reflects the assets excellent retail. Another notable sale was that of 100 Willoughby Street, a 30,000 square foot property in Downtown Brooklyn. The price of just under $23 million is less based on its multifamily aspect and more based on the assets tremendous development potential. Avalon Bay is assembling properties in the area to build another soaring residential tower. 2011 Notable Transactions:

Ariel Property Advisors

building results

1 2 3 4 5 6 7

Jan 2011 | $8.5mm| 1707,10,16,22 Caton Avenue | Two contiguous buildings sell for 8.95 GRM Apr 2011 | $18.45mm| Praedium 6 building portfolio | 244 unit portfolio acquired by Tidy Realty May 2011 | $10mm| 8 building portfolio | Atlantic Gardens buildings sold by Atlantic Assets Group Jun 2011 | $51mm | Three 7-story apartment buildings; 352 units total; GRM of 11 Sep 2011 | $6.1mm | 245 Hawthorne Street | Epsilon Holdings purchased 78 units Oct 2011 | $22.1mm | 3101-115 Avenue | The Parkoff Organization bought 2 multifamily properties (154 units) Nov 2011 | $23mm | 100 Willoughby Street | Avalon Bay purchases corner mixed-use building from Al Laboz

NYC Sub-Market Overview: Brooklyn 1

Brooklyn Jun-Nov 2011 By Property Type

Property Type Elevatored Building Mixed-Use Building Walk-Up Building Portfolio Total / Average Total Dollar Value Traded $74,936,478 $65,062,206 $107,322,576 $58,713,827 $306,035,087 Total Transactions 11 16 37 4 68 Total Buildings Traded 13 16 42 8 79 Total Units Traded 589 322 975 448 2,334

Average $ / SF $129 $231 $146 $117 $162

Average $ / Unit $169,565 $188,276 $116,797 $100,510 $141,193

Brooklyn Jun-Nov 2011 By Neighborhood

Location Bedford-Stuyvesant Bensonhurst Boerum Hill Borough Park Brighton Beach Bushwick Coney Island Crown Heights Crown Heights South East Flatbush Flatbush Ocean Hill Ocean Parkway Park Slope Prospect Lefferts Garden Red Hook Sheepshead Bay Sunset Park Williamsburg Midwood East New York Greenpoint Prospect Heights Bay Ridge Brooklyn Heights Downtown Bath Beach Dyker Heights Canarsie Total / Average Total Dollar Value Traded $4,250,000 $54,456,491 $6,700,000 $6,985,000 $7,500,000 $1,780,000 $4,700,000 $19,176,666 $12,450,000 $5,569,751 $33,425,428 $2,100,000 $1,750,000 $11,065,000 $8,950,000 $1,500,000 $10,544,635 $4,165,000 $31,645,471 $9,180,572 $6,777,732 $4,443,000 $1,675,000 $7,500,000 $10,756,000 $24,039,341 $2,250,000 $5,100,000 $5,600,000 $306,035,087 Total Transactions 3 3 2 3 2 1 1 9 2 3 5 1 1 4 2 1 2 2 6 2 3 2 1 1 1 2 1 1 1 68 Total Buildings Traded 3 5 2 3 2 1 2 9 2 3 7 1 1 5 2 2 2 5 7 2 3 2 1 1 1 2 1 1 1 79 Total Units Traded 51 374 35 63 55 28 14 177 122 82 293 23 21 55 111 16 142 42 145 83 105 31 18 46 34 39 20 71 38 2,334

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Average $ / SF $111 $135 $328 $135 $172 $68 $253 $147 $141 $91 $96 $105 $100 $292 $101 $139 $71 $114 $187 $117 $87 $175 $239 $172 $388 $452 $174 $67 $169 $162 Average $ / Unit $83,542 $127,875 $203,000 $114,360 $139,463 $63,571 $335,714 $118,079 $102,694 $71,089 $94,068 $91,304 $83,333 $213,618 $82,285 $93,750 $73,904 $111,141 $231,584 $110,188 $64,386 $142,125 $93,056 $163,043 $316,353 $469,479 $112,500 $71,831 $147,368 $141,193

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Queens Queens saw two transactions totaling $17 million for the month. The first was 34-20 30th Street, a 62,000 square foot elevatored building in prime section of Astoria. The property sold for an impressive $12,000,000, which represents $192 per square foot and $142,857 per unit. The second sale consisted of two buildings located at 88-04 & 87-26 175th Street. These two elevatored buildings are located in Jamaica sold for $5 million, representing $138 per square foot and $83,333 per unit.

Ariel Property Advisors

building results

2011 Notable Transactions:

NYC Sub-Market Overview: Queens 1

1 2 3 4 5 6

Feb 2011 | $13.4mm| 89-07 34th Avenue | Whitestone Realty sells 132 unit elevator building Mar 2011 | $19.525mm| 82-67 Austin Street | 144 unit blockfront trades for $144psf Mar 2011 | $42.5mm| 26-36 27th Ave | Criterion Dev. Group sells 14 story apartment tower May 2011 | $57.75mm | 245-10 Grand Central Pkwy S | 240 unit elevatored building trades for $219psf Aug 2011 | $14mm | 96-02 - 96-10 37th Ave. | 9 retail, 1 office & 76 residential units @ $163k per unit Nov 2011 | $12mm | 34-20 30th Street | 84-unit elevatored building in Astoria trades for $149k per unit

Queens Jun-Nov 2011 By Property Type

Property Type Elevatored Building Mixed-Use Building Walk-Up Building Total Dollar Value Traded $49,381,738 $15,825,000 $20,026,800 $5,000,000 $90,233,538 Total Transactions 7 2 9 1 19 Total Buildings Traded 7 2 9 2 20 Total Units Traded 342 103 157 60 662

Average $ / SF $169 $181 $184 $138 $176

Average $ / Unit $170,773 $140,379 $129,954 $83,333 $143,636

Portfolio Total / Average

Queens Jun-Nov 2011 By Neighborhood

Location Astoria Briarwood Total Dollar Value Traded $32,626,800 $2,700,000 $14,000,000 $1,510,000 $5,050,000 $6,540,000 $9,025,000 $3,350,000 $3,000,000 $12,431,738 $90,233,538 Total Transactions 6 1 1 1 2 2 3 1 1 1 19 Total Buildings Traded 6 1 1 1 2 3 3 1 1 1 20 191 11 88 22 32 76 68 17 48 109 662

Total Units Traded

Average $ / SF $224 $143 $176 $58 $201 $122 $193 $180 $85 $128 $176

Average $ / Unit $166,186 $245,455 $159,091 $68,636 $157,813 $89,792 $129,989 $197,059 $62,500 $114,053 $143,636

Corona Hollis

Jackson Heights Jamaica Sunnyside Rego Park Rockaway Park Flushing-North Total / Average

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Ariel Property Advisors - Investment Sales | Investment Research Ariel Property Advisors is a New York City investment property sales firm founded by Shimon Shkury. Since 2002, Mr. Shkury and his team have advised private clients, institutions, operators, equity providers and lenders on pricing, positioning, and selling of assets throughout New York City. Together they have sold close to $1 billion in transactions and have provided valuation services to clients on more than 2,500 properties totaling over $12 billion. From multifamily portfolios to office buildings or vacant lots to warehouses, the team has dealt with nearly every different kind of asset class and transaction size. Their discipline has allowed them to develop a vast network of relationships with investors, developers, institutions, brokers and other market participants throughout the region. Our Approach People and relationships are at the heart of every real estate transaction. Our team is committed to providing unmatched value for our clients by combining top-notch, relationship-driven investment sales professionals with cutting edge technology and research support. When marketing the firms Exclusive Listings, our investment sales professionals are in contact with real estate owners, investors, lenders, brokers and other market participants on a daily basis. By fostering these relationships, our professionals develop an intimate knowledge of recent transactions, market trends, the financing environment and the most active market participants. This knowledge gives our platform and clients unparalleled access to real-time market information. Our investment research professionals are responsible for providing our company with a comprehensive sales support operation by fulfilling two essential roles. First, they provide our sales force and clients with informative marketing materials and research reports that are produced with all of the information gathered by our investment sales professionals. Second, they work with our companys proprietary Customer Relations Management system which is powered by Salesforce.com. Customized to meet the specific needs of our operation, this system is powerful tool that greatly enhances the performance of our professionals. Customized Database Platform with Salesforce Technology Ariel Property Advisors relies on a customized central data system that was developed with cloud technology from the popular Customer Relations Management (CRM) provider, Salesforce.com. During the last several years, our investment research professionals have integrated Salesforce technology into all parts of our operation. This integration specifically addressed two primary functions. First, the technology has provided us with an efficient and effective way of collaborating and communicating with clients via the web. Second, the system allows us to centrally track and store any piece of information that is directly or indirectly related to commercial real estate. This technology gives all of our professionals the unique ability to access and act on vital information anytime, anywhere. Asset Evaluation Whether you are an owner considering selling your building or you want to know the current market value of your property, we are available to provide you with a complimentary Asset Evaluation. Produced by the joint efforts of our investment sales and investment research teams, an Asset Evaluation will provide you with a thorough analysis of your investment property. Combining comprehensive financial analyses with real time market data, our Asset Evaluation will help you both establish the current market value of the asset and identify the primary value drivers affecting the price. Our team will not only review todays pricing environment but also explore every possible opportunity that could result in maximizing the assets value, be it today or in the future. Such opportunities can include, but are not limited to, the sale, joint venture, refinancing, or repositioning of an asset. Contact us at 212.544.9500 to request a complimentary Asset Evaluation

Ariel Property Advisors

building results

Multifamily Month In Review: New York City | Contact Us

Contact Info

To learn more about current market conditions or if you would like a comprehensive Asset Evaluation for your property, please do not hesitate to contact us using the information below:

phone: 212.544.9500
Shimon Shkury ext. 11 sshkury@arielpa.com Victor Sozio ext. 12 vsozio@arielpa.com Michael A. Tortorici ext. 13 mtortorici@arielpa.com Jonathan Berman ext. 20 jberman@arielpa.com Scot Hirschfield ext. 16 shirschfield@arielpa.com Research Team Ivan Petrovic Aryeh Orlofsky Dwan Daniels Dusan Panic Jesse Deutch Billy Papayiannis

If you would like to use or quote this report on the web, we ask that you quote the source as Multifamily Trail: New York City by Ariel Property Advisors and link report from our website page (http://arielpa.com/research/reports/)
The information contained herein has either been given to us by the owner of the property or obtained from sources that we deem reliable. We have no reason to doubt its accuracy but we do not guarantee the accuracy of any information provided herein. As an example, all zoning information, buildable footage estimates and indicated uses must be independently verified. Vacancy factors used herein are an arbitrary percentage used only as an example, and does not necessarily relate to actual vacancy, if any. The value of this prospective investment is dependent upon these estimates and assumptions made above, as well as the investment income, the tax bracket, and other factors which your tax advisor and/or legal counsel should evaluate. The prospective buyer should carefully verify each item of income, and all other information contained herein.

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