Earlier this month, Amazon officially announced that it will choose Long Island City as one of two locations for its next headquarters, Amazon HQ2. The move is expected to create an estimated 25,000 new jobs in Long Island City, but what does that mean for the already rapidly expanding neighborhood?

This news may come as a surprise for some, as many believe this will put a colossal strain on the neighborhood’s infrastructure. With thousands of new workers coming to town, the city would most certainly feel the pressure to add even more infrastructure on top of what is already being added. The need to build more schools, restaurants, retail, and residential units are just a part of the equation. The 7 train is already straining to service the neighborhood’s influx of residents which means that more transportation options would need to become available. There is no doubt that there are issues that need to be addressed before the Fortune 500 company arrives.

However, Long Island City has already been going through a massive transformation in recent years, which leads many to believe that the neighborhood will end up being a great fit for Amazon when it comes to town in the coming years. A lot of the construction we are seeing now should be wrapped by that time, which means that plenty of new units will be readily available for the incoming employees. In fact, prior to the news, the de Blasio administration announced its intent to invest $180 million to improve Long Island City’s infrastructure, making the move seem all the more feasible.

Those that are more optimistic about Amazon’s move see this as an opportunity for growth in what is already considered America’s fastest growing neighborhood. Queens continues to grow upwards and outwards and Long Island City is at the center of it all right now. At present, Long Island City is seen as an attractive option for many largely in part to its close proximity to Manhattan, its relatively low cost, and the amazing views you can get along the East River. For investors that are bullish on the area, now might be the time to jump, as Amazon’s move could have quite an impact on housing. In fact, the neighborhood is already seeing a surge in investor activity and buyer interest. Prior to the announcement, pricing in the neighborhood had been gradually decreasing over the course of the year. However, that trend quickly reversed after Amazon’s announcement. Currently, the median listing price for new condos in LIC is $940,000 with a median ppsf of $1,304 according to BuzzBuzzHome. While this is already the priciest neighborhood in Queens, all signs point towards higher condo prices moving forward.

The rental market on the other hand continues to see a major oversupply which is causing a slightly different reaction than the condo market. Rental prices have continued to drop as developers focus more on condos. In fact, Jackson Park’s three building complex has seen pricing drop on some units as much as 13% recently, which is already after multiple previous cuts. The new development rental market in LIC is still relatively strong with a median rent of $3,635 according to BuzzBuzzHome. Expect this side of the market to bounce back as oversupply is minimized while developers shift their focus to condos.

For those looking to set down roots in anticipation of the rapid growth, here is a look at some of the new residential developments coming to the neighborhood as well as a look at how pricing may be affected…

Galerie

  • Estimated Completion: Summer 2019
  • Developed by: Adam America and Vanke US
  • Designed by: ODA New York
  • Sales: Halstead

While pricing has yet to increase here, it will soon. A price hike is expected shortly after required paperwork is filed with the state. Nearly half the units at the ODA-designed condo which launched in February have already accepted offers. In fact, two Amazon employees snagged apartments at the building right before the official announcement was made which has caused some controversy. Regardless, these units are expected to be a hot commodity in the heart of the art district. Units that are in contract on BuzzBuzzHome have an average ppsf of $1,320 while units that are currently on the market have an average ppsf of $1,344.

Corte

  • Estimated Completion: Summer 2019
  • Developed by: CBSK Ironstate
  • Designed by: Dieguez Fridman
  • Sales: Modern Spaces

Long Island City’s newest Argentinian-inspired luxury condo launched back in July and according to BuzzBuzzHome, 19 units are currently in contract with many more expected to fly off the shelves in the coming months. Pricing is expected to rise here shortly as well. Units that are in contract on BuzzBuzzHome have an average ppsf of $1,352 while units that are currently on the market have an average ppsf of $1,361.

The Bond

  • Estimated Completion: Spring 2019
  • Developed by: Chatham Development Company and New York Lions Group
  • Designed by: Raymond Chan
  • Sales: Modern Spaces

Just a five minute walk to Amazon’s proposed Anable Basin site, the 42 unit condo has 3 units in contract since the sales launch just a month ago. Pricing has already increased on 2 units and higher prices are expected when more units hit the market. Units that are in contract on BuzzBuzzHome have an average ppsf of $1,217 while units that are currently on the market have an average ppsf of $1,266.

The Craftsmen Townhomes

  • Estimated Completion: Winter 2018
  • Developed by: Kora Developers and BK Developers
  • Designed by: Zproekt
  • Sales: Modern Spaces

The 36 townhomes spread out across 45th Road, 46th Avenue, and 47th Road provide close proximity to Amazon’s proposed location too. Units hit the market in early November and it is rumored that an Amazon employee has already put down an offer here. You may have guessed that pricing is expected to increase here as well. 4 units have already gone into contract at an average ppsf of $1,137 according to BuzzBuzzHome. More units are expected to hit the market soon.

QNS 44

  • Estimated Completion: Summer 2019
  • Developed by: Rybak Development and BK Developers
  • Designed by: Zproekt
  • Sales: Douglas Elliman

QNS 44 will bring 49 one, two, and three-bedroom units to the heart of Long Island City. This might be the closest of all to Amazon’s expected site, sitting just a stone’s throw away from Anable Basin. The saltwater rooftop pool will sit atop the 4-unit duplex penthouse collection which is sure to attract high end buyers in the neighborhood. Units are not yet released to the public, however they are expected to start around $659,000. This may change too now that Amazon is coming to town.

The Smyth

  • Estimated Completion: Fall/Winter 2018
  • Developed by: D.A. Development Group
  • Designed by: Brent M Porter Architects
  • Sales: Modern Spaces

Further north, a 42 unit condo will be coming to the Dutch Kills neighborhood in LIC. The building was initially slated to launch sales last Spring, however that seemed to get pushed back. Although pricing has yet to be revealed, units are expected to launch any day now. While the Smyth isn’t directly in the center of the Long Island City sweet spot, it is certainly close enough to warrant relatively similar prices to the developments mentioned above.

Other neighborhoods that could reap the benefits of the Amazon move include Astoria, Dutch Kills, Greenpoint, and even Hudson Yards across the river on the 7 line. It is expected that many buyers will try to search beyond Long Island City for more affordable neighborhoods before the ripple effect takes full effect.

Skyline Tower

  • Estimated Completion: 2021
  • Developed by: United Construction & Development Group
  • Designed by: Hill West
  • Sales: Modern Spaces

Perhaps the most intriguing of all new development coming to the neighborhood is the Skyline Tower. The 67-story, 802-unit tower broke ground earlier this year and is going up across the street from the Citigroup building which Amazon is expected to takeover for its HQ2. Last month, the project got approval from the attorney general to begin sales with a $1.008 billion projected sellout. The billion dollar sellout may seem like a lot but due to the fact that the tower will hold 802 residences, the units will average just under $1.25 million. Skyline Tower is sure to test the market when it launches sales. Units are expected to start at $600,000 and go up to over $3 million. Will Bezos buy the crowning penthouse?

As mentioned earlier, there are plenty of rental options in the neighborhood as well. Large scale projects that are currently on the market include ALTA LIC, Jackson Park, Eagle Lofts, Hayden, The Forge, Tower 28, and Hunters Landing. Significant rentals in the pipeline include 5 Pointz, Queens Plaza Park, 43-12 Hunter Street, 24-16 Queens Plaza South, 42-20 27th Street, Jackson East and West, and 43-30 24th Street.

All of the increases in the condo market mentioned in the above list come at a time of year where the market tends to slow down as the holiday months approach. Long Island City real estate has been booming over the past decade but the market seemed to quiet down throughout the year. While buyers may have been waiting for the bottom, it looks like the bottom has come sooner rather than later. The recent pricing trend is now reversing, developers are flocking, and buyers are lining up faster than ever. Simply put, the Amazon effect is heating up.

Header photo: King of Hearts

Zach Taylor
Author

Zach is a market specialist for BuzzBuzzHome based in New York City. Having graduated from St. Lawrence University with a degree in Mathematics, Zach took his interest in data analysis and combined it with his passion for real estate. He manages the data for BuzzBuzzHome's largest territory by volume that is New York City. Zach is passionate about new residential development and providing industry research and insight.

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