NEW YORK CITY—Investors and developers with an eye toward Long Island City or Astoria because of their low prices—compared to Manhattan and other parts of the city—need to pull the trigger soon on any planned acquisitions in those areas. A new report says land prices in the area are skyrocketing. The research, prepared by Modern Spaces based on Q3 data, also studied the pricing of residential rental units and condominiums in the Queens neighborhoods.
In Long Island City, land is selling at an average of over $200 per buildable square foot with some transactions reaching almost $300 per buildable square foot, according to the research. However, the firm believes that the market will level off at $225-$250 per buildable square foot.
Surging land prices in Astoria doubled over the past year, with some properties selling at prices eclipsing $200 per buildable square foot. However, the area's average is still below this figure. Prices are expected to continue rising because Astoria is ripe for development.
“As land and home prices in Manhattan and Brooklyn reach new heights, developers and buyers will naturally be driven to look at Long Island City and Astoria,” says Eric Benaim, founder and CEO of Modern Spaces. “Both Queens neighborhoods have been experiencing this trend of increased demand for some time, which has pushed up prices on all fronts. We feel this upward trajectory will continue into 2015.”
Additionally, the Modern Spaces Q3 2014 report indicates that the Long Island City rental market is stabilizing thanks to the many new projects that have come online this year. Rental prices are averaging in the $50's per square foot and are expected to remain at that level as more units become available. But the condo market is continuing to break records, hitting an average of more than $1,000 per square foot. These prices will increase as demand for new condos continues to grow. Further, since such land prices are so high, new development in Long Island City will most likely result in new condos.
Astoria's residential market is also booming, according to the Q3 2014 report. Condo prices here are reaching over $900 per square-foot. Rentals have hit a new all-time high for the area, climbing into the high $40's per square-foot. Astoria has not seen much new development over the past year but Modern Spaces expects that this will change next year and into 2016.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
