Investors Seize Opportunities in a Surging Long Island Real Estate Market

Marcus & Millichap’s 2021 sales volume in Long Island is up 780% compared to the previous 12 months. This type of increase is particularly noteworthy at a time that remains challenging for many. So who buys and sells in Long Island and how did Marcus & Millichap increase their market share?

Michael Tuccillo, a Long Islander and investment sales specialist in the Marcus & Millichap Manhattan office, spoke to colleague Susan Bands, regional manager of the Marcus & Millichap offices in Manhattan, Westchester and New Haven, with The Real Deal about the robust Long Island Real Estate Market and Factors Most Likely to Affect Investment Opportunities in 2022

Perfect opportunity for the “never sell” crowd

“In general, Long Island has shown relatively slow sales pace and a preponderance of generations of” never selling, “said Tuccillo. However, an influx of residents from Metro-NY during the pandemic boosted Long Island’s economy, resulting in increased demand and higher sales prices in 2021. ”This, combined with general challenges and management headaches posed by the Pandemic caused certain generations of owners to seize the opportunity to sell.

In many cases, Marcus & Millichap’s local market specialization and national platform helped attract new buyers from other states who pay higher prices. In these cases, the team’s local expertise was critical in helping buyers navigate the administrative filings and processes. “Long Island is relatively small, but exceptionally diverse in terms of demographics and trends; it takes an expert who really understands the nuances of Nassau and Suffolk counties and the towns and villages within, ”said Bands, who is also based on the island.

Conversely, many Long Island owners took the opportunity to move their capital out of the state. “We’re seeing a tremendous migration from the New York capital to the southeast and to Texas,” said Bands, “it’s going both ways.”

Where Marcus & Millichap sees new growth on the horizon

According to Tuccillo, “2022 should be another strong year for motivated sellers and buyers entering the marketplace looking for multi-family, industrial, retail, office and self-storage opportunities.

Knowing the demographics and emerging businesses of Long Island, the team can identify opportunities and provide clients with information to help them make informed decisions about any asset before buying or selling.

“The country in and around Metro NY is too expensive, especially when it comes to self-storage. Developers and builders buy land in Long Island to develop into storage units and resell at a low cost. Industrial investors are realizing that properties on Long Island are competitively priced and that the central island offers a timely opportunity, ”says Tuccillo. “In the center of Long Island, investors and buyers can plan new opportunities that take advantage of the extensive transportation networks in close proximity to major highways and railways.”

Outside of commercial developments, multi-family investments are also on the rise due to the rapid expansion of business on Long Island. “Many long-time property owners sold and left the area, opening up opportunities to develop brand new apartment complexes or renovate existing ones,” explains Tuccillo. “This helps to attract tenants with families who are looking for neighborhoods where they can have their lifestyle, work and leisure lifestyles.”

• Many developers have embraced the Live / Work / Play mantra and developed various communities on Long Island. Suffolk County has seen an increase in multi-family activity as people hunt for cheaper property taxes. This in turn has reduced travel time to 30 to 40 minutes as the commercial center has shifted from a center traditionally concentrated in the Nassau County.
• Those looking to move can find properties near downtown Long Island with great amenities – workplaces, hospitals, schools, colleges, and local businesses all help create high demand for housing and retail. Where there is demand, commercial real estate investors compete for success. In Nassau County, real estate competition, despite a higher tax rate than Suffolk County, has resulted in investors paying a higher price for commercial real estate.

With such a surge and a notable shift in residents and tenants moving east in the Long Island market, Marcus & Millichap continues to see growth in activity for all asset types in key locations and growing neighborhoods. Investors can trust Marcus & Millichap to work with to build a competitive advantage that leads to great new opportunities.

“Marcus & Millichap is a national company with a collaborative culture. Our market presence, combined with expertise in processing transactions in Long Island, enables us to maximize value for owners and investors and achieve unprecedented prices. This allows us to draw on a large pool of out of state buyers willing to pay extra for these rare Long Island opportunities, ”says Bands.

Are you looking to invest in the Long Island Market? Contact Marcus & Millichap today.