Red Tape, NIMBYism Continue To Slow Badly Needed Housing Development On Long Island

Long Island was the birthplace of American suburbia, and some 70 years after it was first created, developers, politicians and community members are reckoning with how to reshape its communities to best suit the people who live there.

Developers argue that multifamily development is badly needed on Long Island to meet the demands of the population, but say anti-development sentiment and layers of red tape around new construction causes major roadblocks creating that development.

Like most of the country, the Long Island area has a dearth of housing suitable for middle-class Americans. Compounding the issue, Long Island has some of the highest property taxes in the country and is losing millennials.

A 2017 analysis by the Department of Housing and Urban Development forecast that between April 2017 and April 2020, there will demand for in excess of 1,600 market-rate rental units on Long Island. Only 1,200 are under construction, satisfying just a portion of the demand.

The problem can be fixed, developers told Bisnow, but it requires embracing change.

“When people have seen what [development] can do, there has been a great groundswell of support,” said Tritec Real Estate Co. principal Jim Coughlan, who will be speaking at Bisnow’s Long Island State of the Market event Oct. 31. 

“It’s also about unleashing the silent majority ... if you are upset with a project you go and yell about it at a town meeting," he said, adding that people who support projects do not always show it. "Part of our jobs as developers is to awaken the people it is going to help ... It takes a little more hand-holding out here than in most places.”

Coughlan’s company developed New Village, a 403K mixed-use residential development, in Patchogue. He said the project, which took significant political goodwill to make happen, has become a “political darling” that other Long Island mayors are seeking to re-create in their towns.

Tritec also developed the Shipyard at Port Jeff Harbor, a 112-unit village in Port Jefferson, which Coughlan said was leased up in six months. It soon plans to break ground on 260 units in Lindenhurst and is working on a 53-acre development around the Ronkonkoma train station.

Developments can take years to get off the ground on Long Island, Coughlan pointed out, because of layers of approvals that have to be worked through. But they are worth it, he believes, because the only way to stop younger people from leaving the area is to create the types of communities in which they want to live.

It’s not just about affordability, he said, but creating homes that suit the demographics of the area — which he said is currently out of whack. He said some of his adult children have moved to Manhattan, showing it is not just about cost.

“They didn’t move there because it was cheap … Millennials want to be able to walk out the door and have fun," Coughlan said. "Long Island is really behind the curve ... [but] it is waking up. It has got a lot better in the past five years.”

Patchogue Mayor Paul Pontieri said his community, once bustling in the 1940s and 1950s, has been hit hard by the decline of big-box retail and the rise of e-commerce. When he took office in 2004, downtown was dealing with widespread vacancy.

In the years since, he said the community has focused on bringing in developers with innovative ideas.

“Density is [a] product of design, and if you design it [well], the density becomes less of a factor. People want to look at things that are nice,” he said, adding that while Suffolk County has an average age of 42 years old, Patchogue's average age has dipped to 34.

“I talked to the community [and said] we want young families to come in and invest in the community so old guys like me have people to sell their houses to.”

Major developers are banking on growing demand for housing. Jerry Wolkoff wants to build 9,000 apartments and millions of square feet of office space and retail at the former Pilgrim Psychiatric Center in Brentwood, but has faced significant community backlash over the idea.

“I have lived here for 60 years, [and] I’ve watched every single niece and nephew move off Long Island,” said Michael Capuano, the president of Citizens for a Better Islip, a group that supports the development. “This is in the center of a challenged area … long term, this is something good for the area.”

Beechwood Organization principal Steven Dubb said there has been a dearth of rental product on Long Island, which some are recognizing as a problem that needs to be fixed.

"Municipalities are starting to approve more rental projects because they understand there is a need for it,” he said. “It goes back to NIMBYism … people will agree that we need rentals or condos for seniors, but they don’t want it down the road.”

His firm developed the Vanderbilt, a luxury rental and hotel in Westbury that has units renting for between $3,500 and $8K per month. It is also developing a 750-unit retirement village in Plainview, 84 non-age-restricted homes in East Rockaway and 94 single-family homes in Ridge.

Dubb said his company has found there is significant demand from retirees, and a shortage of appropriate rental housing.

“The biggest barrier to entry is how difficult the entitlement processes are. It’s just very hard to get new projects approved,” he said, pointing to school boards and chambers of commerce that oppose new projects. “It’s changed a bit. Hopefully the trend continues.”

Dubb and Coughlan will speaking at Bisnow’s Long Island State of the Market event on Oct. 31 at Garden City Hotel, 45 Seventh St., Garden City.