Millennials and young families are returning to the suburbs.
Rather than seek the bedroom communities of their parents, young people are drawn to the availability of affordable housing, mixed-use amenities and accessible transportation. Westchester, a New York county once known simply for an abundance of cheap land and good schools, has undergone a renaissance as the amenities that once drove younger residents to New York City come to the area.
“Millennials and young professionals with families looking to escape the rising housing prices and childhood education costs are moving out of Brooklyn and Queens to specific areas of Westchester,” GFI Realty Services Research Analyst Justin Fitzsimmons said. “Developers are focusing on building the same style of amenity-laden developments that you would find in the city but at a lower price point."
Westchester has long been a commuter enclave. TV shows like “Mad Men” highlight towns like Ossining’s popularity among Manhattan executives, who can travel from Grand Central to their front doors in under an hour. More recently, development has skewed toward town centers, as developers create mixed-use rental buildings near transit stations in Mount Vernon, New Rochelle and White Plains.
Yonkers has seen an especially large boom in growth. Over 4,000 new rental units will be released over the next eight years in the area, according to GFI Realty Services.
Mount Vernon has emphasized the development of affordable housing stock. In June, four developers announced proposals to bring a total of 900 units, worth over $300M, to the city. Enclave Equities submitted one of the four proposals. The company plans to build 179 units across five apartment buildings.
According to a study from the New York City-based Regional Plan Association, adding 250,000 homes to the city's suburbs over the next 20 years could help solve the affordable housing crisis in New York.
Enclave Equities’ projects also offer features like roof decks and smart technology that allows users to control power and lights from their phones.
In White Plains, the city has focused on transit-oriented projects that will build up the town center with restaurants, bars and retail. The city announced in June that it was seeking developers for 4.5 acres around its Metro-North rail station.
The White Plains Mall has also recently been targeted for mixed-use redevelopment. Port Chester-based developer Street-Works Studio and the building’s owner, WP Mall Realty, proposed replacing the mall with a 900K SF multifamily housing development, retail space and a craft food hall.
Millennials are not the only group returning to urbanized suburbs. On a smaller scale, empty nesters looking to downsize — but not wanting to leave the towns in which they raised their families — are also taking advantage of the new “all-in-one” housing stock, Fitzsimmons said. The growing inventory of multifamily allows retirees to downsize while staying in their hometowns.
The influx of young professionals, especially more affluent renters, has led to rent growth. In Yonkers, the median rent for a one-bedroom apartment was $1,800 as of Q4, compared to $1,400 in Q1 2011. Other towns in Westchester County have embraced a growing market for luxury multifamily housing. The Lofts on Saw Mill River in Hastings-on-Hudson offer “Tribeca-like” apartments starting at $3,645 for a 952 SF one-bedroom.
In the Village of Dobbs Ferry, The Danforth Apartments are marketing one-bedroom apartments with resort-style amenities from $2,725 to $3K and two-bedroom apartments from $3,605 to $4,100.
Increased excitement over the growing amenities and multifamily supply in Westchester will lead to continued growth and further exploration of New York City’s northern suburbs, as prices rise and new developments drive up the median price per square foot in target areas.
“We’ve analyzed, we’ve studied and we’ve seen underserved markets, under the right conditions, thrive beyond expectation," Fitzsimmons said. "It is our belief, our understanding of the data we’ve examined, that just like the rapid success we’ve seen throughout the outer boroughs, the area in question is ripe for revitalization; Westchester is ready to rise.”
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