Joel Leitner and Josh Berman have nearly 50 years of combined real estate experience, providing expert valuation to a variety of clients in the financial, legal, and accounting sectors.  Leitner Berman strives to bring a similar level of expertise to these service areas, maintaining a focus on professionalism and detail in order to serve its clients.

Property Types Appraised:

The recent changes to New York City rent regulation laws had a far-reaching impact on residential real estate values.  Multifamily appraisals account for these new laws in the valuation of both market rent and rent regulated apartment buildings.  Multiple approaches are generally considered, with direct capitalization utilized for stabilized, cash flowing properties and a discounted cash flow constructed to account for proposed renovations, lease-up, and other fluctuations in cash flow. 

The appraisal of for-sale units within larger properties is key for acquisition financing, refinancing, and estate planning.  For-sale residential unit types appraised include individual condo and co-ops units for or larger, unsold blocks of units for condo inventory loans.  This property type also includes the valuation of entire cooperative buildings (for underlying permanent mortgages) through a rental fallback valuation.

The accurate valuation of single- and multi-tenanted office properties is paramount as many workers begin to shift into a more work-from-home schedule.  In addition to the development of a discounted cash flow using Argus, additional analysis considers the tenant rollover schedule, planned capital investment and leasing, current and future discount rates, and terminal resale valuation.

Even prior to Covid-19, a shift was underway in the urban retail landscape as consumers began to place a heavier focus on e-commerce, relying less on in-person shopping and dining.  Appraisals address the changing environment to bricks-and-mortar retail with an analysis of tenant roll, any planned future leasing and landlord investment, and future potential use for vacant spaces.

Industrial properties have become one of the most sought-after asset classes in recent years as e-commerce businesses, logistics firms, and technology companies need large swaths of warehouse, flex, and R&D space near major metropolitan areas.  Like an office appraisal, valuation of industrial space accounts for the credit of the tenancy, pending rollover, capital improvements, and landlord contributions for tenant buildout.

Development site values are affected by the same considerations affecting all other real estate property types.  Land appraisals utilize two methods to account for these macro issues – market trades (which rely heavily on a geography and zoning analyses)  and a residual land valuation which accounts for the project’s budget, leasing or sale absorption, and projected pro forma.

Hospitality valuation differs from other traditional property types since in addition to the real estate, consideration is given to the hotel’s business operations and position within the competitive set.  In addition to location and market comparison, the hotel’s flag, property manager, top-line occupancy and rate metrics, and expense and profit margins are essential factors in determining value.

In the New York City Metropolitan area (as in any major urban market), many properties consist of multiple uses.  Apartment buildings on major commercial corridors tend to have ground floor retail, some high-rise multifamily or office buildings have a hospitality component, and an industrial building may have spaces built out to wildly varying degrees depending on the space use.  Appraisals of mixed-use space account for the cash flow that each different use contributes to property financials and determines capitalization and discount rates for the property depending on the strength and predictability of these various income streams.

New York City has many incentive programs for developers to help spur affordable housing throughout the five boroughs.  Appraisal of affordable developments consider renter pool income restrictions, limits on on-site market rate development, various real estate tax benefits, and affordable housing tax credits which can be sold on the open market.

Like hospitality properties, health care and senior housing facilities have a business valuation component beyond traditional real estate valuation.  The valuation considers the owner/operator and manager of these facilities, as operating margins are essential to the property’s sustained success.