The sales team at Queens brokerage Modern Spaces met Tuesday morning to discuss how to configure and price the penthouses atop the borough’s tallest condo building, Skyline Tower, in Long Island City. Naturally, their planning session took into account the big news: that Amazon was close to a deal to locate a new office hub in the neighborhood.
“We were thinking of creating a really nice, full-floor apartment for Jeff,” Eric Benaim, president of the brokerage, said about Amazon.com Inc. Chief Executive Officer Jeff Bezos, the world’s richest person. “We’d have a built-in Alexa.”
Long Island City, a fast-growing area just across the East River from Manhattan, is one of two locations that together would house as many as 50,000 Amazon employees in its ever-expanding workforce, according to people briefed on the negotiations. The news has left local real estate brokers starry-eyed with possibility, and even the most sober data-watchers are calling for a range of optimistic scenarios for the Queens sales and rental markets.
The neighborhood has seen a flood of apartment construction in recent years, creating an overabundance of glassy towers that have depressed rents and pushed landlords to offer incentives to lure tenants. The for-sale market has fared better, with prices climbing sharply as buyers seek out the area as an affordable option with a short commute to Manhattan.
Queens sale prices have hit records for six consecutive quarters, with the average reaching $635,281 in the three months through September, appraiser Miller Samuel Inc. and brokerage Douglas Elliman Real Estate said. In the past five years, the median home price has jumped 45 percent, according to listings website StreetEasy.
Tens of thousands of new workers in Long Island City would probably keep the sales-price momentum going and could even start a wave of housing speculation, said Grant Long, senior economist at StreetEasy. Areas adjacent to the neighborhood — such as Sunnyside, Astoria and Brooklyn’s Greenpoint — may also see an uptick in demand and pricing.
“If you’re marketing a condo right now, this is like manna from God,” said Justin Elghanayan, president of Rockrose Development Corp. It’s also a boon for an apartment developer like Rockrose, which owns or has under construction almost 3,000 rental units in Long Island City.
Elghanayan described a virtuous circle of benefits: Amazon would bring thousands of “interesting people” to the neighborhood, which, in turn, would draw more creative retail and other tech companies to locate offices there. All that would increase the appeal of renting in the area.
A Whole Foods, owned by Amazon, is a given, he said. But expect more bars and restaurants that do well with a 24-hour presence of both office workers and residents.
And there’s a potential near-term benefit for those glass-tower landlords: They might finally be able to dial back concessions and charge higher rents, according to Long.
“A two-year lease looks a lot nicer today than it did on Sunday,” he said.
This article was provided by Bloomberg News.
