Westchester’s Hot New Real Estate Sector: Luxury Rentals
JULY 24, 2015
Residential Development is Booming in Westchester
Residential development is booming in Westchester, but there’s nary a two-car garage or cul-de-sac in sight. Real estate companies are developing, constructing, and opening apartment buildings in the county at an unprecedented rate, according to informed sources. Just this week, news broke that Valhalla-based developer Martin Ginsburg wants to build a 55-unit luxury apartment building at 1177 Warburton Avenue in Yonkers, just one block north of a 330-unit Ginsburg Development Companies apartment building now under construction. Lighthouse Enterprises, whose three luxury rental buildings in White Plains are nearly fully leased, broke ground this spring on a 50-unit apartment building in Port Chester. Harrison, New Rochelle, Bronxville, Tarrytown, and Dobbs Ferry also have apartment projects in the works.
National multifamily developers are arriving in Westchester, too. Lennar Corporation, one of the nation’s largest homebuilders, expects to break ground this fall on a mixed-use project with 700 market-rate rental apartments, located on the site of the former Westchester Pavilion property in White Plains. Berwyn, Pa.-based LCOR is building two 16-story apartment buildings at 55 Bank Street, White Plains, with 449 market-rate rental apartments and 112 affordable rental units.
What’s behind Westchester’s apartment boom? In part, it follows a nationwide jump in multifamily construction, reflecting a growing consumer preference for urban living. Last week, the Department of Commerce reported that multifamily housing construction starts of five or more units rose 55% in June 2015 over June 2014. That compares to an increase of 14.7% for single-family home starts over the same period.
What’s more, Westchester, with its small, livable cities and network of villages and Metro North stations, is benefitting from a spillover of demand from New York City.
“It’s back to the future,” explains Marissa Brett, president of the Westchester County Association. “Millennials are attracted to Westchester for the same reasons that drew previous generations here: proximity to a world capital, excellent train service into New York City, and greater real estate value compared to New York City. But millennials are not as interested in single-family home ownership at this point in their lives. So if we to build apartments with New York City-style amenities and continue to create vibrant, walkable communities, we will attract plenty of tenants who will feel right at home here.”
Officials and developers say an influx of high-earners from New York City has led to a growing appetite for Westchester luxury rentals. Yonkers Mayor Mike Spano notes that one luxury developer told him that he is targeting Yonkers because of a 12% surge in city residents with income between $200,000 and $400,000 annually. “To the developer, it is a clear signal that individuals who live in New York City and could be going to Hoboken or Williamsburg are choosing to come to Yonkers,” Mayor Spano explains.
“People are voting with their feet,” adds Brett. “They want to live in walkable communities with easy access to mass transit and shopping, where there are restaurants, entertainment, and other people with whom to socialize. Rents in Manhattan and Brooklyn are outrageous, so guess what? Renters are looking at Westchester’s very livable and booming cities, and they like what they see!”
And it’s not just millennials hankering for a Work. Live.Play lifestyle. Empty nesters increasingly view urban living in the suburbs as the next logical step in their lives. They continue to live close to friends and often family, but they don’t have to be as dependent on their cars to get around. “A lot of empty nesters are coming to White Plains,” explains White Plains Mayor Tom Roach. “One of them told me his car didn’t leave the garage all weekend, and he and his wife were out the whole weekend. There’s an awakening in people of all ages that there are good reasons to live in our city.”