What’s next for Astoria’s condo boomlet?

Brokers say sales volume holding even as prices drop

Sep.September 01, 2008 03:27 PM

Vickie Palmos is betting on Astoria.

Just a few months ago, the 30-year-old real estate agent left her job at Value Lane Realty to strike out on her own. Her new company, Astoria NY Condos, specializes exclusively in — you guessed it — new condos in one of Queens’s most diverse neighborhoods.

“Astoria is in the infancy of becoming an area like Park Slope,” Palmos said. “I was getting more and more requests for Astoria condos, so I decided to focus specifically on that market; I’m staking my business on it.”

Indeed, the Queens neighborhood has no less than 10 new projects in the works.

Nonetheless, average condo prices have dropped there in the last year, and several of the latest developments have seen price reductions.

According to numbers compiled by StreetEasy.com, the average price for a condo in Astoria dropped from $519,357 in August 2007 to just under $489,915 in August 2008. (The price of houses, however, has climbed steadily, from an average $891,285 a year ago to $948,875 today.)

Meanwhile, of eight units on the market in the Astoria, a 27-unit building developed by Criterion Group, all but two have dropped their asking prices. And at the Astoria Windsor, the last two sales, both of two-bedroom units, each closed at more than 10 percent below the asking price.

Other projects are reportedly converting from condo to rental, a sign that the market in the neighborhood may be soft.

But Palmos and others shrugged off any negativity, saying compared to nearby Long Island City — where prices average $754 per square foot compared to Astoria’s $647 — units in the neighborhood are selling six weeks faster.

“Astoria buyers aren’t as concerned with amenities,” said Palmos, referring to perks in Long Island City such as the Crescent Club’s Leon Fitness Center, putting green, pool and screening room, and 44-27 Purves’s children’s playroom and roof deck with private cabanas.

In fact, Astoria condos are selling an average of five weeks faster than they were a year ago, which Palmos attributed partly to a new generation of buyers (specifically first-time buyers and a smattering of empty-nesters) discovering the area.

“There’s no infrastructure in Long Island City,” she said at a meeting with a reporter at the New York Grand Café on 30th Avenue in the heart of Astoria. “Astoria is an established community. This is a real neighborhood.”

Indeed, from where she sat, on the corner of bustling 30th Avenue and 37th Street, she could see two other upscale restaurants — brand-new Bala and Flo Café — which are busy serving drinks and appetizers to 20- and 30-somethings. New York Sports Club, Victoria’s Secret, Starbucks and the Gap are all around the corner on Steinway Street, the area’s main commercial drag.

“We’re like Greenwich Village but half the price,” boasted long-time broker Charles Sciberras of Realty Executives Today. “People making $50,000 to $80,000 a year can afford to live here, while you really have to make closer to $100,000 to buy in LIC.”

Palmos said she just closed the last sale on the Newtown Towers, a 10-floor, 28-unit condo tower completed in September 2007 and located at 25-25 Newtown Avenue, less than five blocks from the Astoria N/W subway stop. She expects to start selling the Newtown Villas, another nearby eight-unit condo project, in February.

“Astoria didn’t boom like Brooklyn and LIC because there wasn’t much condo inventory,” explained Corcoran agent Adriano Hultman. “Back in 2004 and 2005, when Williamsburg and LIC became strong, developers would go there because they could buy large parcels of land and build 60- to 80-[unit] apartment buildings.

“Astoria was already a neighborhood so there wasn’t that type of land available.”

According to Hultman, as much as 90 percent of Astoria’s housing stock consists of rental buildings or two- and three-family homes. But like Palmos, Hultman sees the area as being hospitable to “the right kind” of condo development.

So what is the right kind of development for this established, but evolving, neighborhood?

Hultman’s partner at Corcoran, Robson Lemos, said he and Hultman came to the area about three-and-a-half years ago and began reaching out to local brokers and asking potential buyers what kind of condos they’d be attracted to. Soon, they had developed a database of amenities that buyers did and didn’t care about.

“Families wanted big kitchens,” said Lemos. “And we found out a lot of the single people looking at the area traveled a lot, and also were likely to be very active — they wanted big closets to store luggage, surfboards and skis.”

Lemos and Hultman put all this information to good use when they hooked up with Saika Builders to create LIC’s Casa Vizcaya and more recently, the Orient Condo, a 60-unit building going up on the corner of Broadway and Vernon Boulevard in Astoria.

Lemos said the Orient will feature apartments with marble bathrooms and verandas overlooking Socrates Sculpture Park.

Lemos is also marketing the Ionian, a 19-unit building scheduled to start closing this month. According to StreetEasy.com, one-bedrooms there are currently listed for between $499,000 and $559,000.

Shibber Khan, a co-founder of the Criterion Group, which develops real estate in the area, said the firm is bringing “Manhattan-style amenities” to its Astoria buildings.

Criterion recently completed sales at 14-43 28th Avenue, a 38-unit condo constructed in 2005. Another project, 1 Astoria Square, a 117-unit condo building at 21st Street and Astoria Boulevard, is currently in the foundation stage; the firm hopes to begin marketing the condos in December. Khan estimated that studios would start at $275,000, with one- and two-bedrooms asking $350,000 and $450,000, respectively.

“We’re very optimistic about the market,” said Khan. “A lot of the housing stock here is old and outdated, so new product gets snatched up quickly — that’s been our saving grace.”

On 37th Street, the developer Petros Yiannikouros said construction should finish at the Poseidon, an 18-unit condo building, by November and that the project will feature large, glass-enclosed balconies and penthouses with views of Hell’s Gate and Manhattan’s East Side. Yiannikouros said that he hopes amenities like bamboo floors, walk-in closets and Roman baths will set the building apart.

“We’re trying to do something totally different,” said Yiannikouros, who left his life as a chemist in Los Angeles to get into real estate. “We don’t want to do that Astoria brick-block building.”

Palmos is also marketing new condos at the Apollo, an eight-unit condo building on 32nd Street and Ditmars Boulevard, steps from the subway; and the 37th Street Condos, which has nine one- and two-bedroom units ranging in price from $499,000 to $1.15 million.

And the list of new projects goes on. Two other towers, one 20-story condo on the waterfront and another 10-story residential building at 31st and 30th streets are also reportedly in the works.

“The stigma of moving to Queens is really going away,” said Lemos, who points to the area’s proximity to Midtown Manhattan (“A $10 cab ride from Central Park!”), as well as the convenience of having fish and vegetable markets, plus Greek, Italian and Mexican restaurants all crowded together on the six-block stretch of 30th Avenue.

Errol Cilen, a 42-year-old Queens native who’d been living on Long Island until his recent divorce, just bought in the Newtown Tower.

“I was looking for an investment — the ‘next Williamsburg’ kind of deal,” said Cilen, who paid $460,000 for his one-bedroom. “The quality of the condos in Astoria seemed to be really high, and the price was good.”

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