The Nelson Report – May 2025

While we’re still months away from being able to provide meaningful commentary on tariffs, I can assure you that deals are still happening! Avison Young’s Investment Sales team has closed two sales, signed a hard contract for a development deal, and even received a $71 million offer from a Chinese buyer!

If you are making longer term investments (rather than day trading real estate), I would love to debunk a narrative that has been dragging out since Covid – nobody is leaving NYC! Many clients and industry pros I’ve spoken with were shocked to hear that the number one metro area for growth from 2023 to 2024 was actually NYC! Thanks to the NYC Economic Development Corporation (EDC) for bringing this to my attention (If you haven’t seen what they’re doing on the NYC waterfront to accommodate this growth, take a look at: https://edc.nyc/delivering-sustainable-infrastructure).

It is true that in 2020 and the years leading up to it, NYC saw a major migration of residents out of major cities, including Los Angeles and San Francisco in favor of cities throughout Texas and the Sun Belt. According to the U.S. Census Bureau, the NYC metropolitan area lost 277,000 people while Dallas picked up 109,000 in 2020, but in the last few years NYC has once again begun to pick up pace.

There were 213,403 people added to the NYC metro area followed by Houston, Dallas, Miami, and DC. NYC has come up from its 2021-22 position when we were #423 in population growth by doing a complete 180 in 2023, flying up to #5, before claiming the top spot. It’s like Cole Hocker who won gold in the 2024 Olympics - I’m not sure if 213,403 people added to a metro area in one year is all-time record, but if you walk around in NYC in any major destination, you can really feel the city pulsing with activity.

What is largely driving recovery is the return to office. Miami, DC, and NYC continue to hold the top three spots in RTO efforts across the board. Cities that have great office busyness in turn have great multi and retail demand.

 
We are actively tracking these population trends across all major markets and submarkets. In one recent client presentation, we geo-fenced a four-block area in a suburban office park. The amount of data that is available today can really drill down to incredibly specificity but still very important to keep your eye on macro population trends as opposed to false narratives that might find their way into the headlines.