By Chad Sinsheimer, director, Eastern Consolidated
Since 2006, more than 8,600 units of housing — 2,200 condos and 6,400 rental units — have been completed in Long Island City and more than 22,500 are in the planning and construction stage, according to the LIC Partnership.
This demand pushed the average price of prime Long Island City development sites to nearly $250 per buildable square foot in the first half of 2015, a 269 percent jump compared to the first half of 2012 when developers were picking up land for an average of $67 per buildable square foot, according to Eastern Consolidated’s MetroGrid Report: Long Island City.
Three sales in the first half of the year, however, at 24-01 Queens Plaza North, 21-10 44th Drive, and 42-14 27th Street saw sales around $300 per buildable square foot, a price point that is becoming the norm in Long Island City today.
With land prices rising, many Long Island City developers are shifting their planned projects from rentals to condos and they’re finding a market because local renters with growing families want to buy in the neighborhood.
Average condominium prices in Long Island City are rising in tandem with development costs, however, jumping over 98 percent to $1.27 million today from $640,000 in the first half of 2012.
Eastern Consolidated is seeing this trend first hand and in June closed on a development site for $43.5 million, or $257 per buildable square foot, at 22-12 Jackson Avenue. The buyer was Adam America Real Estate, which plans to raze the existing building and construct a luxury residential condominium.
Historically a Brooklyn developer, Adam America is entering the Long Island City market for the first time with its Jackson Avenue project. We expect to see more developers migrating to Queens since land prices, while rising, are still less than in Manhattan and parts of Brooklyn.
Experienced builders moving into Long Island City include Manhattan developer Property Markets Group, which is building a 391-unit, 45-story luxury apartment building at 23-10 Queens Plaza South, and is in the pre-development stage for an 800+ unit, 70+ story luxury mixed-use apartment building at 29-37 41st Avenue.
Manhattan/Brooklyn developer Slate Property Group is building an eight-story condo at 21-21 44th Drive, and Ekstein Development Group is betting on the Long Island City market in a big way with two 80/20 projects at 26-14 Jackson Avenue and 10-44 44th Drive, and a condo project at 25-19 43rd Avenue.
While most of Long Island City’s residential development has been clustered south of the Ed Koch Queensboro Bridge, more and more developers are building farther north of the bridge. Eastern Consolidated, for example, sold two development sites in this area last year at 37-10 Crescent Street and an assemblage comprised of 37-29 31st Street and 37-26 32nd street, where developers are planning rental projects.
Around Queens Plaza and Court Square, the de Blasio Administration is conducting a study to explore increasing density to encourage affordable housing development.
The Department of City Planning kicked off its first meeting with local stakeholders last February to review zoning changes to about 100 blocks in the LIC Core Study Area, which includes the Queens Plaza and Court Square neighborhoods, the Queensbridge Houses campus, and the Jackson Avenue and Northern Boulevard corridors. In the study area, the Department of City Planning has identified several substantially under-built or vacant sites that will be reviewed.
The study also will explore the need for public investments such as new schools, public open spaces, storm water and sanitary sewer upgrades, and pedestrian, bicycle, and traffic safety and streetscape improvements.
Waterfront development in Long Island City has been dominated by TF Cornerstone, which purchased a tract of waterfront property from PepsiCo in 2003.
Since then the firm has completed seven residential towers with over 3,000 units along Center Boulevard, changing the Long Island City skyline as well as the public’s perception of the neighborhood.
Waterfront development has since shifted south in Long Island City to an area known as Hunter’s Point South.
This 30 acre site will be improved with up to 5,000 housing units, five acres of parkland, a new school, new retail space and parking. Phase I (925 units) is a joint venture between Related Companies and Phipps Houses.
Phase II will be developed by TF Cornerstone and Selfhelp Community Services which will bring an additional 1,193 units to the site.