-- Bob Knakal, Chairman and CEO of BKREA and one of the most prolific investment sales brokers in U.S. history, has released a new guide titled “The Ultimate Guide to Selling User Buildings at a Premium in NYC.” The guide offers a rare look into why vacant buildings—especially those under 100,000 square feet—can often command higher prices than leased ones in Manhattan.
Get Access To The Guide Here https://www.bkrea.com/user-building-sales
Drawing on more than three decades of experience and nearly 1,000 completed sales, Knakal explains a unique market phenomenon: user buyers, or those who plan to occupy the space themselves, are willing to pay an average premium of 16 percent above what an investor might offer.
“Most people think a leased building is always worth more—but in Manhattan, that’s not always true,” said Knakal. “When users—like retailers or schools—see the right building, they’re willing to pay a premium for control, tax benefits, and long-term value. Our data shows that premium averages about 16 percent.”
In the guide, Knakal explains that these user buyers value real estate differently. They are not focused solely on cash flow from tenants. Instead, they see ownership as a strategic advantage—providing brand control, privacy, depreciation tax benefits, and the ability to manage the space exactly how they want.
“A user buyer sees a building not just as real estate but as an extension of their mission or identity,” Knakal said. “That emotional and strategic value is what drives the premium.”
The guide identifies the most active types of user buyers in New York City, including retailers, which account for over 20 percent of user building purchases, and educational institutions, which account for nearly 20 percent. Other active groups include corporations, religious organizations, non-profits, healthcare systems, and foreign governments.
By using industry-segmented buyer lists and timing the market correctly, Knakal notes that sellers can reduce sales time and maximize value. He also emphasizes the importance of pricing strategies that reflect the user premium, allowing sellers to realize a higher-than-expected return.
The report is based on sales data from hundreds of real-world transactions and decades of market insight. According to Knakal, these deals prove that understanding buyer motivation is critical to success in the Manhattan user-building market.
Common questions are addressed in the report. The user premium is the extra price an end-user will pay to own and occupy a building, rather than lease or invest in it. These premiums exist because ownership offers benefits such as depreciation, operational control, and avoidance of lease uncertainty. User buyers are most commonly found among retailers, schools, non-profits, religious groups, and institutional organizations. The guide also suggests that sellers can find these buyers more efficiently by using segmented industry lists and tailored marketing efforts.
Ownership also comes with potential tax advantages, but Knakal advises consulting with tax professionals to understand individual benefits.
The guide serves as a practical resource for sellers looking to position their vacant buildings in front of the right buyers—and get paid a premium for doing so.
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