Super deluxe condominiums are rising on Long Island, with starting prices at $1 million or more, amenities including pools, golf simulators and private cinemas, and staff that will deliver poolside snacks and cocktails, offer lifts to the train station, bring fresh flowers and even walk residents’ dogs.
Demand is strong. Some buyers are purchasing two multimillion-dollar condominiums and combining them to make room for visiting relatives, friends and clients, or for an expansive collection of art and furniture.
At the Ritz-Carlton Residences in North Hills, which opened last year, all but four of the first 110 units have sold, at prices from $1.5 million to $6 million. Uniondale-based developer RXR Realty initially planned to offer 124 units, but 14 buyers each purchased two adjacent units and combined them into homes up to 3,800 square feet.
Those buyers “are still downsizing from a 6,000-square-foot home, or 7,000- or 10,000-, but they’re not going down so far as to feel like they’re in a small apartment,” said Gail Holman, an associate broker at Daniel Gale Sotheby’s International Realty who is handling sales at the complex.
RXR took note of the demand for larger condos and is constructing roomier residences — up to 3,700 square feet — as it builds 120 more condos, due to be completed in early 2019. Forty of those have gone into contract, the developer said.
The boom in luxury condominiums is a relatively new trend on Long Island, where condo developments were once mostly “utilitarian,” said Jonathan Miller, chief executive of Manhattan-based appraisal firm Miller Samuel. For high-end buyers, he said, “it’s less about downsizing and more about having someone else taking care of the lawn, the roof, painting . . . and also getting these common-area amenities that they wouldn’t get in a single-family home.”
Baby boomers downsizing from 5-acre estates on the North Shore and affluent families and singles seeking an easy commute to Manhattan and the Hamptons are among those driving sales, brokers said.
“It’s an urban-suburban lifestyle,” said Gwen Levy, a real estate agent with Daniel Gale Sotheby’s International Realty who is handling sales at Roslyn Landing, a new 78-unit complex of town houses priced from about $1.4 million to $1.75 million. Some buyers, she said, “have come from very large homes and are looking for something beautiful and brand new.” Others, she said, “might be starting a family, and that might be a reason it’s appealing to them.”
Developers and real estate brokers express optimism about the prospects for new high-end condos.
In Long Beach, a local developer is constructing an 11-unit oceanfront building where prices will likely start at about $2.5 million for 3,500-square-foot, four-bedroom condos, said Susan Solomon, a real estate agent with Beach West Realty.
She said she believes sales will be strong.
“I have to find 11 buyers, and I know they’re there,” she said. “They just want to be at the beach, and they want to get there fast.”
Units at the oceanfront Aqua, a Miami Beach-style building in Long Beach with curving walls and blue glass, have been selling for about $1 million to nearly $2.7 million since 2009, Solomon said.
Resident Bernie Shapiro, 81, moved there in 2011, a year after his wife passed away. The couple’s 5-acre property in Muttontown became “a little more than I wanted to undertake on my own,” Shapiro said.
His first reaction on seeing the Aqua, he recalled, was “what the hell is that?”
Now he wakes up every morning to a “spectacular” ocean view, and enjoys the condo’s beach club, which offers lounge chairs and food delivery, he said. The condo owners include full-time residents as well as Manhattan families who want an oceanfront retreat that’s closer than the Hamptons, he said.
To be sure, multimillion-dollar condos remain a sliver of Long Island’s housing market. Condo sales make up only 14 percent of all sales on Long Island, and they trade for a median price of $290,000, the most recent report from Miller Samuel and brokerage Douglas Elliman shows.
But sales of condos for $1 million and up have spiked since 2014, Miller said. That’s when the luxury housing boom in Manhattan — where condos and co-ops now sell for an average of $2 million — began pushing even affluent buyers to less costly locales such as the Island, he said.
From 2013 to 2015, the number of condo sales for $1 million and up on Long Island soared from 13 to 225, Miller Samuel figures show. Long Island had 159 such sales last year, and 111 so far this year, Miller Samuel figures show. The figures include most sales of condominiums in multifamily buildings, plus town houses and free-standing homes with homeowners associations.
Online real estate listings show condominiums in multifamily buildings selling for $1 million and up in places ranging from the North Shore and Long Beach in Nassau County to waterfront communities in Suffolk County such as Northport and the East End.
In an indication that developers are building pricier units, the expected cost of construction is rising. So far this year, builders have taken out permits to construct 236 developments of five or more units in Nassau County, at an estimated construction cost of nearly $340,000 per unit, census figures show. That’s the highest average cost in at least a decade; over the previous 10 years estimated costs ranged from about $29,000 to $217,000.
In Suffolk County, estimated construction costs for developments of five or more units have varied from about $106,000 to $174,000 per unit over the five years ended in 2016, the most recent available census figures show. Over the previous five years costs had ranged from about $67,000 to $157,000.
It is unclear what impact the tax overhaul signed into law on Friday by President Donald Trump will have on demand for high-end condominiums. Some real estate and tax industry experts predicted the new $10,000 limit on federal tax deductions for state and local taxes, and the $750,000 cap on mortgage debt eligible for interest deductions, will prompt affluent buyers to scale back their budgets or delay purchases. Others believe lower tax rates will put more money in the pockets of high-income buyers, potentially spurring sales.
The tax changes will put “downward pressure” on prices, as buyers will have fewer tax incentives to buy a home, Miller predicted. “The federal government essentially has backed away from encouraging homeownership in high-cost housing markets like the East and West Coasts,” he said. Sales are likely to slow as buyers insist on price cuts and sellers initially refuse to budge, he said.
But wealthy Long Islanders can expect tax savings that could range from a few thousand dollars for a salaried employee to roughly $50,000 or more for some business owners, said Wes Kirchhoff, a certified public accountant and professor at Molloy College in Rockville Centre.
To be sure, the loss of certain tax deductions will be “bothersome,” he said. But, “I don’t care who you are, $50,000 in your pocket is a good thing, so I see that as a plus for the market.”
Kirchhoff said he has several friends who have been shopping for high-end condos on Long Island. Such buyers, he said, “want luxury rather than space.”
That was the case for Aileen Murstein, who is in her 70s, and her husband, Alvin Murstein, 80, who combined two units at the Ritz-Carlton Residences. The move from their house in Old Westbury was about the “peace of mind” that comes with a staff to handle maintenance, security and day-to-day tasks such as sending clothes to the dry cleaner, as well as amenities that include indoor and outdoor pools and a fitness center.
Their desire, she said, was to “lock the door, go on your trip, not worry about anything. A lot of empty nesters feel the same way — they don’t want to have to worry about snow removal or leaks.”
Now, Aileen Murstein said, she and her husband have shorter commutes to their jobs — Aileen is a real estate associate broker in Roslyn, and Alvin is chief executive of a financial firm in Manhattan — and she makes regular use of the gym. And their spacious three-bedroom home has enough room for their collection of sculptures, paintings and photographs.
Downsizers make up a majority of buyers at the Ritz-Carlton, said Joe Graziose, senior vice president at RXR. Many, he said, “are not looking at single-family homes at all, they’re looking at communal living.”
At the Ritz-Carlton, Graziose said, “I’m selling a lifestyle.” The amenities include poolside food and drinks service, a screening room, billiards room, concierge and valet service and rides to the train station in a black Cadillac Escalade. Housekeeping and dog-walking can be arranged for extra fees. Monthly common charges and taxes range from about $3,000 a month for a 1,700-square-foot unit to about $6,200 for a 3,400-square-foot, selling for $4.6 million.
Compared with the costs of maintaining a single-family home with a pool and landscaping, Graziose said, “it’s a good value proposition.” RXR also is constructing the Beacon, a 167-unit condo building in the massive Garvies Point development in Glen Cove, where asking prices range from $575,000 to $2.7 million and about one-fourth of the condos have gone under contract.
Nassau County has seen the bulk of the new construction, but the East End also is getting new high-end condos.
In Montauk, oceanfront condos at the Residences at Gurney’s — converted from the former Panoramic View resort — are listed at prices ranging from $2.3 million to $8.95 million. Of the 18 units, seven have sold for $2.2 million to $4.5 million.
The first 10 years of ownership include membership at the adjacent Gurney’s Montauk Resort, which allows owners to use amenities such as the pool, spa and fitness center, said Chris Coleman, a real estate agent with Saunders & Associates who is handling sales. Resort services include deliveries of food and drinks to residents’ cabanas, sommelier service and golf reservations. Surfing lessons, bonfires, clambakes, fresh flowers, chartered yachts, private chefs and butlers are available for additional charges.
Among the buyers is Andrew Leigh, president of California apparel company Jerry Leigh, who splits his time between Malibu, the San Fernando Valley, the West Village in Manhattan and now Montauk. Leigh purchased a condo at Gurney’s in 2016 as a “maintenance-free” home on the East End. A few months later he bought the unit next door so he’d have room to host his two daughters, 20 and 24, as well as friends and, eventually, clients.
“It’s a great place where we can all be together,” he said. “My girls love the space.”