Long Island City’s stroller invasion

Condo ‘fire sale’ unexpectedly lures families to nabe
By Candace Taylor | August 01, 2010 12:00PM

Letia Frandina and her newborn at her store Little Closets on Vernon Boulevard

Some New York City neighborhoods are known for being family-friendly, with their toy stores, maternity boutiques and stroller-choked sidewalks. The Upper West Side. Tribeca. Park Slope. Even the Financial District. But there’s a new neighborhood joining their ranks: Long Island City.

Brokers and residents say the post-industrial Queens neighborhood — largely viewed as a still-gritty area favored by young professionals — is now experiencing a massive, and somewhat unexpected, baby boom, accelerated by a market-driven “fire sale” of condos.

The trend is stemming from two key factors. First, young professionals who moved to the area a few years ago are now starting families, and with prices down, they can afford to upgrade into larger apartments in the neighborhood, brokers say. And second, amenity-rich new residential towers in the area are drawing young parents looking for more space than their money can buy in Manhattan.

“Before 2005, there was nary a stroller,” said Nancy Verma, who pens the popular Long Island City blog liQcity. Now, she said, “we are getting tons and tons of young families. It’s a serious baby boom. We joke that it’s a mini-Park Slope.”

The change has come about so quickly, though, that it’s surprised developers and real estate agents in the area, where large apartments have been scarce — until now.

“Everybody who bought here a year ago decided to procreate,” said Eric Benaim, CEO of Long Island City brokerage Modern Spaces. “We probably should have seen this coming.”

A decade ago, Long Island City — which sits directly across the East River from Midtown — was an aging industrial district, full of hulking warehouses and factories left vacant by the decline of manufacturing in the 1970s. A 2001 rezoning changed that, leading to a building frenzy of sleek residential towers in the mid-2000s.

Thousands of new condos and rental units have come online since then, and the city’s Economic Development Corporation plans to begin construction next year on some 5,000 waterfront units at Hunters Point South.

Like other emerging neighborhoods, the rebirth of Long Island City was driven at first by young people with relatively small budgets, said Jon McMillan, director of planning with developer TF Cornerstone, which owns several residential buildings in the neighborhood and has plans to build some 2,000 more units there.

Young professionals “come in and help get a neighborhood established,” McMillan said. As a result, he said, “our first two buildings emphasized more studios and one-bedrooms.”

Now that there are more amenities in Long Island City — like restaurants, a grocery store and a Duane Reade — the area is becoming more attractive to families, McMillan said. Unlike the first two buildings, TF Cornerstone’s new condo, the View at East Coast, “has very large, family-size units,” he said.

The Long Island City market — like the rest of the city — ran into trouble during the downturn. The View, for example, came on the market just before Lehman Brothers collapsed (and when TF Cornerstone split off from family business Rockrose). By December 2008, only 18 of the building’s 184 units had gone into contract, and the sponsors instituted a “buyback” program, promising to buy back apartments from purchasers at 110 percent of the original sales price after five years.

Once the downturn hit, Long Island City “lost a lot of our buyers,” Verma said. “A lot of them were from Wall Street.”

Many planned condo developments stalled, and at those that were built, many new units are sitting empty. As a result, prices are much lower now than during the boom. In the second quarter of 2010, the average sale price of a new development condo in Northwest Queens (which includes LIC) was $599,297, down nearly 14 percent from the market peak of $697,038 in the first quarter of 2008, according to Miller Samuel. Prices at the View have reportedly fallen from around $1,100 per square foot to roughly $850, and in May, a two-bedroom unit at new condo L Haus at 11-15 50th Avenue closed for $519,307, down from its original listing price of $605,000.

“We are basically having a condo fire sale,” Verma said. “There a lot of bargain hunters.”

Unlike the waves of artists and young, single people who were initially attracted to Long Island City, many of these bargain hunters have turned out to be families, brokers said. And while this family phenomenon is taking place all over the city, it’s particularly pronounced in LIC.

“We’re getting a lot of families now — definitely more than a year ago,” said Benaim, noting that in the past few weeks he’s worked with a number of clients from Brooklyn.

“There’s a huge influx of people from Park Slope,” he said. “They want to be closer to Manhattan.”

Others already live in Long Island City, and are using the drop in prices to move into larger spaces as their families grow, he said. “We’re seeing a lot of people upgrading,” he said.

Price was a major factor for Letia Frandina, who moved to Long Island City from North Carolina two years ago, around the same time that she gave birth to her son.

She chose an apartment on Vernon Boulevard in Long Island City because “it was closer to my husband’s job than anywhere we could afford to live in Manhattan,” Frandina said. “Even on the Upper West Side the commute would have taken longer.”

Frandina, who gave birth to her second baby late last month, noticed that there were many other young families in the area, but few children’s clothing stores. Last year, she opened a children’s consignment store, Little Closets, at 46-46 Vernon Boulevard. Nearby, daycare Lolly’s Learning Center opened around the same time.

When a new, 8,000-square-foot children’s playground opened in LIC’s Gantry State Park over Memorial Day weekend, “it was mobbed within the first 10 minutes of opening,” said Verma, who blogged about the event. “It was filled with soccer moms and nannies.”

In fact, there are so many children in Long Island City that they’re quickly outgrowing the schools in the area. For the first time this year, “a significant number” of students who applied to attend pre-K at P.S. 78, located in the City Lights building at 48-09 Center Boulevard, didn’t get in, Frandina said. TF Cornerstone will soon begin construction on a new 600-seat K-8 public school at Queens West, and a 145,000-square-foot middle/high school is planned for Hunters Point South, but classes there are already expected to top 40 students each, Verma said.

Despite all this activity, LIC is still perceived as a neighborhood mostly occupied by young professionals.

Perhaps because of that perception, developers are scrambling to meet the new demand for family-sized units. Until now, three-bedroom apartments “didn’t exist in Long Island City,” said Solarium developer Joseph Palumbo.

While he built mostly studios and one-bedrooms in the building (it only has four three-bedrooms), they can be combined with adjacent studios to create spaces that are around 1,600 square feet (see “Making floor plans flexible”).

“Definitely, families are looking for more space,” he said, adding: “In retrospect, I would have had more three-bedrooms.”