Pressing pause: COVID-19’s impact on transactions has varied based on property type
With the swagger of David approaching Goliath, an organism 0.12 microns in size — some 1/200,000 of an inch — stopped the sale of a 1.17 million-square-foot office building. SL Green Realty Corp.’s $815 million deal to offload 220 E. 42nd St., a 37-story Art Deco skyscraper in Midtown Manhattan, collapsed in late March 2020 amid growing concerns of an outbreak of COVID-19 in the United States. The little bugger won and gave investors their first sign of what was to come.
In the following months, the virus descended like a grain of sand into the gears of the commercial real estate transaction market. Deal volume tumbled 71 percent year-over-year in April, and May 2020 saw the lowest volume for any May since 2010, according to Real Capital Analytics. By mid-June, only $7.3 billion in private equity real estate deals had been completed during the second quarter, down from $31 billion in the first quarter, despite nearly $150 billion of dry powder waiting to be deployed in