Long Island: Nice Place To Build, If You Dare
By Dawn Wotapka
- Associated Press
- The area’s got some nice looking beaches.
Long Island, N.Y. is known for a contradictory mix of things: Beautiful beaches, tony Gatsby-esque mansions, hideous strip malls, horrendous traffic, a rickety commuter-rail line.
Here’s something else: It’s possibly the toughest market in the country for apartment development. That’s what several real-estate experts I spoke with said about the region near New York City.
For the brave souls willing to battle various powerful local governments and outspoken civic groups, there are rewards: Long Island brims with opportunity. The housing stock is largely single-family homes, with apartments just 17% of inventory. That compares with 35% and 38% in Bergen County, N.J., and Westchester County, N.Y.
AvalonBay, the only public developer currently willing to invest the time in building apartments there, charges thousands of dollars a month to everyone from college graduates to seniors looking to downsize. Long Island’s home prices are high, so many people pay steep rental rents well into their 30s. (Disclosure: I used to live on Long Island.)
“When people think of hard-to-build markets, everyone thinks of Los Angeles. I would say Long Island takes the cake,” said Alexander Goldfarb, a real estate investment trust analyst with Sandler O’Neill + Partners LP. “There is a very strong anti-renter sentiment that seems to exist on ‘The Island’ that we do not see in other REIT markets.”
Others agree. Home Properties Inc. owns older apartment properties on Long Island, but it isn’t pursuing new construction. “There is a scarcity of land, it takes a long time for approvals,” said Charis Warshof, vice president of investor relations. It isn’t “new apartment development friendly.”
Follow Dawn on Twitter @dwotapka
