Multi-family income property increases in value during 2006.

Massey Knakal Realty Services' newly-released New York City Income Property Market Report, prepared by Miller Cicero, LLC, reveals that all indicators suggest higher values in the first half of 2006 for walk-ups, elevatored buildings and mixed-use properties.

In general, capitalization rates declined, gross income multipliers (GIMs) increased and the price per square foot increased across property types and in all markets.

Manhattan (south of 96th Street) had the highest prices and the lowest cap rates while the Bronx, had the lowest prices and the highest cap rates.

"The New York City Income Property Market Report demonstrates a general increase in the number of sales in nearly every category," said John Cicero, MAI, CRE, founder and managing principal of Miller Cicero, LLCa commercial real estate valuation and consulting firm specializing in New York City.

"In Manhattan, a modest increase in prices across all property types reflects a market beginning to stabilize. In Northern Manhattan, sharp increases in prices for walk-ups and a corresponding drop in the number of sales suggests a lack of quality inventory rather than lack of demand.

"High sales volume and turnover in the Bronx indicates that investors have 'discovered' this market."

"We are very pleased with the quality and quantity of information this report provides," said Robert Knakal, chairman and founding partner of Massey Knakal, the full service property sales company specializing in the sale of investment and user properties.

"Nothing like this has existed in the marketplace. We are confident that participants in the market will find it useful and insightful."

Market report highlights include:

* Multi-family and mixed-use income property increased in value throughout the city in the first half of 2006. The increase appears to be at least partially driven by large increases in the underlying rents, both residential and retail.

* The most active market segment was Brooklyn walk-up apartment buildings, with over 600 sales. Brooklyn elevatored apartment buildings experienced the highest turnover of inventory, with 3.1% of the total inventory selling in the first half.

* In contrast, Manhattan walk-ups and elevator apartment buildings experienced little turnover, with 1.5% and 1.2% of inventory, respectively, sold in the first half.

* Cap rates for walk-up apartment buildings remained at or near record lows, ranging from a low of 4.6% in Manhattan (south of 96th Street) to a high of 7.9% in the Bronx.

* The number of Bronx walk-up apartment buildings sold in the first half of 2006 nearly doubled over the prior half (second half of 2005), an indication that investors have "discovered" this market.