Opportunities abound in New York City real estate, say lawyers at Greenberg Traurig

As the New York real estate market continues to adjust to post-pandemic consumer demands, inflation, and general economic uncertainty, lawyers at global law firm Greenberg Traurig, LLP are poised to help clients take full advantage of the opportunities these changes present.

“Undoubtedly there have been radical changes in how people use real estate — from the new ways we work, commute and live to how we shop. While these shifts are largely traced to the pandemic, the seeds were already there,” says Stephen Rabinowitz, Co-Chair of the firm’s Global Real Estate Practice. “Global events act as accelerants for emerging trends and spark the rapid changes in investment patterns to accommodate our evolving relationship to real estate.”  

Earlier this year The Real Deal learned more about how Greenberg Traurig’s Miami Real Estate Practice has transformed the South Florida skyline, and here we talk with its New York City practice about what they are seeing in the country’s financial epicenter and beyond. 

Varied Sectors Offer Promise

The city that never sleeps will never sleep on real estate. “We are seeing inflow from all over the world as clients seek security in times of uncertainty, and that’s what New York City offers,” says Howard Schochet, Co-Chair of Greenberg Traurig’s New York Real Estate Practice. “Clients who are focusing on trophy assets still see opportunity for investment.”

In fact, Greenberg Traurig was involved in some of the most transformational deals of the year, including SL Green’s purchase of 450 Park Avenue and its sale of 885 Third Avenue to the Memorial Sloan Kettering Cancer Center. In addition, the firm represented SL Green as the junior mezzanine lender in the recapitalization of 5 Times Square.

Greenberg Traurig sees favorable options in several asset classes. While Class A office space always garners strong interest, it’s particularly attractive right now, especially for foreign capital seeking a flight to quality. On the other hand, Class B office space is expected to struggle, which means investors may decide to remodel buildings to meet Class A standards or even turn the space into residential properties.

“We will help our clients solve complex legal issues with creative solutions,” Schochet says.

Courtney McGuinn, a real estate shareholder at Greenberg Traurig and Co-Chair of the firm’s Women’s Initiative, notes that she is seeing a significant shift among investors toward hospitality and industrial, to name two particularly strong sectors.

The shift toward these particular asset classes makes sense from a macroeconomic standpoint as investors try to align income and risk. For example, hotels are attractive to investors because they offer a high degree of variance in their income models, which means they can fine-tune rates to address market conditions and inflation. Single-family residential and student housing are two other assets with similar opportunities.

While inflation remains an unknown, Rabinowitz believes it’s only a matter of time before those who are sitting on the sidelines get back to the market. “Investors’ reactions to inflation are as much a function of perception as they are of any hard rules,” he says. “As interest rates stabilize investors should start feeling freer to make bolder moves.”

Although the uptick in interest rates has fueled some slowdown in activity, lenders are adapting, says Corey Tessler, Co-Chair of Greenberg Traurig’s Real Estate Finance practice. He finds many lenders are moving to five-year paper as an alternative to a traditional 10-year model. “Buyers may be more apt to close on a five-year deal with the expectation that interest rates will decrease in the next two or three years, and they can then prepay the loan and refinance it,” he says.

Laser Focus and Global Connections Fuel the Greenberg Traurig Difference 

What sets Greenberg Traurig apart from other firms is its unwavering focus on all facets of real estate. In fact, it was founded more than 50 years ago in Miami with land use and real estate as core offerings. Both practice areas remain a cornerstone of Greenberg Traurig, which is unique among global law firms of its size. Building on its impeccable reputation in real estate, Greenberg Traurig is a full-service firm that encompasses a wide range of departments like tax, labor, litigation and private equity, with the ability to be viewed through the lens of real estate when it matters for clients.  

“All of our departments are deeply integrated into our real estate ecosystem,” Rabinowitz explains. “When we consult colleagues, we never have to get them up to speed on the market. No matter what the discipline, Greenberg Traurig lawyers are deeply knowledgeable about the real estate world.”

That also translates into niche capabilities in a number of specialty industries, such as agriculture, live entertainment and healthcare or health-related services, which many clients are offering as amenities in their office and residential buildings.

“These highly specialized sectors have physical and technical requirements that we are uniquely equipped to help them with,” says Rabinowitz. The firm has the knowledge and experience to advise on matters related to the power and ventilation needs of a biotech building, for example, or insurance issues unique to agriculture. . “We have the versatility to approach a wide range of deals and then provide relevant real estate representation to execute at the highest levels for the client.”

This granular expertise extends to its geographic footprint, as well. With 43 offices in key locations, the firm’s global presence is an invaluable asset to clients aiming to expand.

“Our offices worldwide work very closely with us here in New York City, and our reputation precedes us. When clients want to do deals in New York, they are often already familiar with the brand equity we offer,” Schochet says. “They also recognize we understand the nuances of each region where we have expanded, from Nassau County to the Hamptons.”

As New Yorkers increasingly relocate to Miami, Greenberg Traurig holds a key advantage as one of the city’s top firms, says Kristen Lonergan, Co-Chair of the firm’s New York Real Estate Practice. “We have deep local connections we can leverage as clients aim to break in there.”

The same principle applies for clients looking outside of these two key markets, notes Rabinowitz, who’s currently helping a company with an expansion in Salt Lake City, a desirable market because of its educated population, high standard of living and relatively low cost. The client can rely on the significant resources of Greenberg Traurig’s local office. “I can’t imagine any other firm has the same ability to serve clients in this unique way in so many markets. Clients appreciate they don’t have to go outside our firm to a local firm they don’t know,” Rabinowitz says. 

In fact, Tessler recently joined Greenberg Traurig from another prominent firm because he was attracted to its impressive full-service platform.

“Whether it’s a zoning issue or tax-related litigation, we have colleagues all over the country in different jurisdictions, and it’s invaluable to be able to pick up the phone and get masterful insight into how something is handled there,” he says. “I can effectively staff deals all over the country.”

“Clients appreciate the seamlessness we offer,” agrees Brandilyn Dumas, who focuses her practice on commercial real estate transactions. “We can be more efficient and provide services at a competitive cost given our team’s presence in so many markets. Real estate is local, and it’s an incredible advantage to be able to call our colleagues in different offices and leverage their knowledge to ensure a smooth transaction.”

Reflecting Diversity Attracts Clients and Talent

While clients benefit from this deep expertise, they also appreciate how Greenberg Traurig professionals prioritize relationships. After all, at its heart, real estate is primarily a relationship-driven business, says Dumas.

And although Greenberg Traurig represents some of the most sophisticated developers, financial institutions and other large clients, the firm also is able to support clients at all stages of their life cycle, including those who are just entering the space. “An entrepreneurial culture is encouraged here, which means we assist both traditional and non-traditional clients,” Dumas says.

For example, she recently worked with a faith-based group that wanted to monetize some of its real estate holdings. In addition, she recently closed a deal with a family-owned mall owner divesting its assets.

“One of the most rewarding aspects of my job is working with a diverse breadth of clients—from major institutions to small developers—and helping them expand,” says Dumas.

Dumas believes one of the factors that attracts this wide-ranging clientele is the diversity of Greenberg Traurig lawyers. She herself entered the field after working as a teacher.

“I am surrounded by youth and diversity,” says Rabinowitz. “Those of us in the firm who are more senior have worked hard to assemble this group of accomplished partners as we aim to make the firm look more like the world around us. We want what we’ve built to be sustainable, and that means reflecting the diversity of our clients. We’re able not only to forge relationships with a more diverse clientele but also to attract and retain the talented colleagues who are the basis of our success. This is the Greenberg Traurig difference.” 

Not only are they embedded in New York, but Greenberg Traurig also is backed by more than 2,650 lawyers in 44 offices worldwide Click here to connect with the team.