We are pleased to announce the closing of our acquisition for a building in Manhattan, New York City, through our American subsidiary.
Real estate prices in NYC softened due the current situation. This created short term challenges, but also a very attractive entry from a pricing standpoint. We believe in the city and that the disruptions caused by COVID-19 to be temporary. The transaction represents a terrific opportunity to acquire a solid multi-family building at an attractive valuation in one of the most vibrant cities in the world. Notwithstanding the short term challenges, we believe that this type of investment will generate regular income through rentals and offer a robust opportunity for appreciation, both in the short- and long-term.
In addition, we were fortunate to obtain very attractive financing that will allow us to generate positive cashflow from day 1. This type of asset and financing also protect us against inflation. The combination of lower real estate prices and favourable mortgage rates presents an opportunity for great risk-adjusted returns that are rare in this environment where most asset classes trade at very high valuations.
The building is in great structural conditions, but requires internal renovation. Our team is skilfully modernising the interiors as well as some of the exterior to maximise the attractiveness to prospective tenants and our return on investment. We will post more pictures as soon as the renovations are complete.
