Property prices are again on the rise, and in New York, the hottest commodity lately is retail sales for condos.

As Wall Street Journal reports, New York City has seen a rise in New York retail sales for condos, driving up sale prices in tourist districts and nearby areas where residential development is underway. Many office buildings are also being repurposed as condos.

Manhattan real estate attorneys want to underscore that while these kinds of transactions can be wise investments – in some cases yielding high returns – they should never be completed without thorough legal review. Investors and buyers need to be assured that the terms are fair, that there will be no issues in using the property for the intended purpose, and that the investment makes good financial sense.

Many of these spaces may also be leased, and the terms of those agreements must also be carefully reviewed.

The Journal reports that retail-property sales (primarily condominiums) have increased three-fold from 2010 to 2013. The value of those sales also ballooned, from $610 million to nearly $3 billion. This year, retail sales are on track to surpass $3.6 billion.

Part of the momentum for this unprecedented growth has to do with the influx of international tourists. New York has always been a destination for world travelers, but more than usual, have been flocking to the state in recent years, analysts say. Retail condominiums, in particular, are a hot item for a few reasons. One has to do with the fact that the costs for maintenance are generally lower than for residential properties.

Plus, investors are finding that buying a single retail condominium tends to be far more manageable than what it would cost to rent long-term or buy up a whole building.

Such investments have become increasingly popular along Madison and Fifth avenues. In these spots, the average rent ranges from $1,300 to $2,500 per square foot. These are the areas that are seeing the most amount of tourist traffic, so leasing prices are at a premium. Sales costs are also higher, but investors and some businesses find those costs more easily justified because the values are expected to continue to increase.

Retailers are finding that by purchasing a smaller property, rather than renting a larger one, they can save hundreds of thousands of dollars or more over the life of their business. This way, the company has an asset to trade if the industry takes a downward turn.

For example, the retail condo at the base of Mercer Street and Broadway, which just sold for about $42 million. By the summer of 2012, that same property sold for $57 million. The following year, it sold again for $80 million.

Still, it’s not just the high-end retail districts that are drawing attention. Other attractive areas include those where residential condominium development is thriving, transportation hubs are thriving, and places where there is generally a lot of foot traffic.

Investors and businesses are hoping to get the most for their money by focusing on up-and-coming neighborhoods, particularly in the outer boroughs.

The Wright Law Firm is a business law firm located in Midtown Manhattan. Call (212) 619-1500 for a confidential consultation.