Coops and condos for sale: rare and desirable.

With interest rate hikes on the horizon, retail space buyers are looking to acquire retail condos and co-ops for their own use or for investment while the rates remain low.

In a submarket widely considered only rental, investors and users alike clamor when a retail space becomes available for sale. Only a few properties like these are generally available at any given time, as developers tend to hold onto these units for themselves.

This relative scarcity compared to other types of real estate has led to a very strong market for these types of property.

Among the few currently available are 143 West 26thStreet; 124 West 18th Street; and 140 Charles Street, all listed by Massey Knakal. Each is very attractive to a specific group of buyers.

143 West 26th Street serves as an excellent investment opportunity due to the fact that it has a tenant in place until 2012, yielding an immediate return of nearly 7% at the $1,650,000 asking price. It has 33 feet of frontage and about 2,600 square feet of interior space, as well as 2,200 square feet in the finished basement. Meanwhile, 124 West 18th Street poses an excellent user opportunity. With over 1,400 square feet of interior space, an additional 650 square feet in the basement and 24 feet of frontage, this space would support a number of uses at an asking price of $1,750,000. 140 Charles Street, located on the corner of Charles and Washington, is flexible because it contains approximately 10,000 square feet divided into four units, offering an excellent opportunity for both users and investors. Moreover, the property features 140 feet of prime frontage on the corner of Charles and Washington Streets.

Larger spaces frequently sell to investors who will look for a credit tenant to net lease the space. This type of arrangement essentially serves as an annuity for the property's owner.

A retail cooperative spanning three floors at 519 Broadway, which was recently offered to the market, has a 20-year lease with a major international retailer in place, providing a buyer with an approximate 7% return.

A net leased property can serve as one of the most stable and reliable types of investments available, especially as compared to other more volatile asset classes like stocks and mutual funds. Meanwhile, smaller retail condos and co-ops are ideal purchases for users who generally do not require the use of an entire building for their business. At 136 West 17th Street, which Massey Knakal recently placed under contract near the asking price of $1,150,000, or $694 per square foot, the property was ideal for a dermatologist.

In addition to doctors' offices, restaurants, retail stores and certain types of offices are all obvious buyers for smaller spaces like these.

Recently, as the benefits of owning a retail unit have become clearer and demand has increased, the types of offerings available have become more and more creative. Massey Knakal was recently retained to sell 21 West 9th Street with an asking price of $4,000,000. The offering is actually comprised of 70 remaining years on an original 99-year proprietary lease.

With its footprint spanning over 5,000 square feet, seating for 120, and a functional kitchen, restaurant space of this caliber and size is very rare.

This impressive space was occupied for a number of years by the restaurants Ocean's 21, and more notably, by Mary Lou's.

As evidenced by the scarcity of product on the market as well as the impressive demand for it, retail spaces have been selling for a premium and will likely continue to do so.

MANAGING PARTNER JAMES NELSON & ASSOCIATE BRENDAN GOTCH, MASSEY KNAKAL REALTY SERVICES