Long Island business groups conduct survey to highlight local issues for developers
Carpenters frame the roof of a home under construction in Nesconset. Long Island developers say rising costs and delays have led many to build in other states. Credit: Newsday/John Paraskevas
Long Island developers have long argued that the cost and time to develop housing and commercial real estate locally have pushed them to consider projects in other states.
Now, a trio of Long Island business and real estate groups aims to document how much builders have invested elsewhere to encourage policymakers to take action.
The Long Island Association, the developers' group Association for a Better Long Island and the Long Island Builders Institute, in partnership with Long Island University’s Steven S. Hornstein Center for Policy, Polling, and Analysis, have launched a survey to collect responses from developers through the end of the month.
The goal is to gather data to share with lawmakers who influence new development, which often requires local government approval of zoning changes.
Real estate experts say a shortage of available housing — both for sale and for rent — has driven up housing costs on Long Island.
The median price of a home on Long Island, excluding the East End, hit a record $700,000 in the third quarter of 2024. A report last year showed Long Island has the highest percentage of cost-burdened renters of any region in New York state, at 51.4%. Renters are considered cost-burdened if they spend more than 30% of their gross income on housing, according to federal guidelines.
Matt Cohen, CEO of the Long Island Association, which represents the region’s largest employers, called the lack of housing affordability on Long Island “an existential crisis” that threatens businesses' ability to attract and retain workers.
“The hope is the data we collect is a wake up call for policymakers," Cohen said. "That it sounds the alarm clock and we can’t hit the snooze button anymore. We hit the snooze button for decades.”
The survey asks Long Island developers about the size of their organizations and what percentage of their portfolio — both in terms of investment and residential units — has been built away from Long Island. It also asks respondents to identify the top obstacles to development from a list that includes taxes, government approvals, material costs, labor costs, utility costs, attracting new tenants and NIMBYism, or “Not In My Backyard,” a term describing local opposition to new developments. Respondents can also write in other barriers they think of that aren't listed on the survey.
By polling developers, the groups are taking a "builder-centric" approach to addressing housing affordability, an effort that could benefit from other perspectives, said Richard Murdocco, an adjunct professor at Stony Brook University who teaches courses on economic development and planning. However, he acknowledged these groups are stepping in to produce data that local governments have not collected.
"If there’s a gap, and no one is sitting there advocating for a balanced approach to growth and sustainability and productivity, the industry is going to step in, and they’re going to take leadership for better or for worse,” Murdocco said.
The survey, which LIU is conducting without compensation, focuses on developers venturing out of state, said Kyle Strober, executive director of the Association for a Better Long Island. Data from the survey could support more comprehensive planning efforts, he added.
“More and more, I hear from developers that they’re looking for opportunities off Island because there’s a frustration with the building process and things move a lot quicker and easier off Island,” Strober said. “It’s important to quantify how big of a problem and how deep it is.”
At a Long Island Builders Institute forum in April, housing developers detailed how they have increasingly pursued opportunities out of state. Steven Dubb, principal at the Jericho-based Beechwood Organization, said his firm had built 2,500 units of housing in North Carolina. Gabriel Randall, then-chief operating officer at Jericho-based B2K Development, said the company had 1,000 units in predevelopment at the time in Virginia.
"Both cited the lengthy approval process from local Long Island governments as a reason for looking elsewhere," Randall said.
The rate of new housing growth in Nassau and Suffolk counties ranked near the bottom among 141 counties with at least 500,000 people from 2012 to 2022, according to a report issued last year by Construction Coverage, which publishes research for builders and the real estate industry.
Nassau ranked 131st, with a 2.7% growth rate of new housing over that decade, and Suffolk ranked 132nd, with a 2% growth rate, Newsday previously reported.
Strober said "every housing development is a financial risk," and that developers who decide to build outside Long Island have determined that local projects here aren't worth it because of the barriers they face.
"If developers are increasingly seeking more opportunities off Long Island, that means competing regions are fostering economic environments with less risk," he said.
The survey follows a report issued in the fall by the Builders Institute that pointed to lengthy delays to receive municipal approvals and the cost of construction insurance as among the top obstacles to building.
“If builders and investors find more favorable conditions elsewhere, it could result in a detrimental cycle where decreased investment leads to fewer job opportunities and further population loss,” Mike Florio, CEO of the Builders Institute, said in a statement announcing the survey.
Long Island developers have long argued that the cost and time to develop housing and commercial real estate locally have pushed them to consider projects in other states.
Now, a trio of Long Island business and real estate groups aims to document how much builders have invested elsewhere to encourage policymakers to take action.
The Long Island Association, the developers' group Association for a Better Long Island and the Long Island Builders Institute, in partnership with Long Island University’s Steven S. Hornstein Center for Policy, Polling, and Analysis, have launched a survey to collect responses from developers through the end of the month.
The goal is to gather data to share with lawmakers who influence new development, which often requires local government approval of zoning changes.
WHAT NEWSDAY FOUND
- Long Island business and real estate groups are surveying developers this month to find out how much they're investing in projects away from Long Island.
- Matt Cohen, CEO of the Long Island Association, which represents large employers, called the shortage of available housing options "an existential crisis" for businesses trying to attract and retain workers.
- Long Island home prices hit records levels last year, as real estate experts said too few homes for sale drove up prices.
Real estate experts say a shortage of available housing — both for sale and for rent — has driven up housing costs on Long Island.
The median price of a home on Long Island, excluding the East End, hit a record $700,000 in the third quarter of 2024. A report last year showed Long Island has the highest percentage of cost-burdened renters of any region in New York state, at 51.4%. Renters are considered cost-burdened if they spend more than 30% of their gross income on housing, according to federal guidelines.
Matt Cohen, CEO of the Long Island Association, which represents the region’s largest employers, called the lack of housing affordability on Long Island “an existential crisis” that threatens businesses' ability to attract and retain workers.
“The hope is the data we collect is a wake up call for policymakers," Cohen said. "That it sounds the alarm clock and we can’t hit the snooze button anymore. We hit the snooze button for decades.”
Quizzing builders
The survey asks Long Island developers about the size of their organizations and what percentage of their portfolio — both in terms of investment and residential units — has been built away from Long Island. It also asks respondents to identify the top obstacles to development from a list that includes taxes, government approvals, material costs, labor costs, utility costs, attracting new tenants and NIMBYism, or “Not In My Backyard,” a term describing local opposition to new developments. Respondents can also write in other barriers they think of that aren't listed on the survey.
By polling developers, the groups are taking a "builder-centric" approach to addressing housing affordability, an effort that could benefit from other perspectives, said Richard Murdocco, an adjunct professor at Stony Brook University who teaches courses on economic development and planning. However, he acknowledged these groups are stepping in to produce data that local governments have not collected.
"If there’s a gap, and no one is sitting there advocating for a balanced approach to growth and sustainability and productivity, the industry is going to step in, and they’re going to take leadership for better or for worse,” Murdocco said.
The survey, which LIU is conducting without compensation, focuses on developers venturing out of state, said Kyle Strober, executive director of the Association for a Better Long Island. Data from the survey could support more comprehensive planning efforts, he added.
“More and more, I hear from developers that they’re looking for opportunities off Island because there’s a frustration with the building process and things move a lot quicker and easier off Island,” Strober said. “It’s important to quantify how big of a problem and how deep it is.”
At a Long Island Builders Institute forum in April, housing developers detailed how they have increasingly pursued opportunities out of state. Steven Dubb, principal at the Jericho-based Beechwood Organization, said his firm had built 2,500 units of housing in North Carolina. Gabriel Randall, then-chief operating officer at Jericho-based B2K Development, said the company had 1,000 units in predevelopment at the time in Virginia.
"Both cited the lengthy approval process from local Long Island governments as a reason for looking elsewhere," Randall said.
The rate of new housing growth in Nassau and Suffolk counties ranked near the bottom among 141 counties with at least 500,000 people from 2012 to 2022, according to a report issued last year by Construction Coverage, which publishes research for builders and the real estate industry.
Nassau ranked 131st, with a 2.7% growth rate of new housing over that decade, and Suffolk ranked 132nd, with a 2% growth rate, Newsday previously reported.
Strober said "every housing development is a financial risk," and that developers who decide to build outside Long Island have determined that local projects here aren't worth it because of the barriers they face.
"If developers are increasingly seeking more opportunities off Long Island, that means competing regions are fostering economic environments with less risk," he said.
The survey follows a report issued in the fall by the Builders Institute that pointed to lengthy delays to receive municipal approvals and the cost of construction insurance as among the top obstacles to building.
“If builders and investors find more favorable conditions elsewhere, it could result in a detrimental cycle where decreased investment leads to fewer job opportunities and further population loss,” Mike Florio, CEO of the Builders Institute, said in a statement announcing the survey.
Jonathan LaMantia covers residential real estate and other business news on Long Island. He previously covered the business of health care for Crain's New York Business.
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