The Amazon-fueled New York City real estate boom just went bust.
Realtors in the Long Island City neighborhood of Queens had been doing brisk business since Amazon announced plans to move its "HQ2" there in November — and were stunned when Amazon backed out of the deal on Thursday.
"The citizens of Long Island City are in mourning," said Eric Benaim, CEO of Modern Spaces Realty, a real estate firm focused on Queens. "It's a sad day for Queens and all of New York.
"You're taking away 25,000 people from employment," he added, referring to the number of people Amazon had been expected to hire.
The project's announcement kicked off a buying frenzy in the weeks after it was announced. Modern Spaces sold 150 apartments in a one-week span — about 15 times more than average, the company said.
Some Amazon employees had tried to beat the rush and bought real estate in the area, according to The Wall Street Journal.
"There was a big boost in business in November and December," Benaim said.
Plenty of inventory was available. Between 2006 and 2016, more than 11,500 apartments were built in the area, and another 8,600 units are scheduled to be built in the next three years, according to Modern Spaces.
“Prices went down in LIC 5 percent prior to the original news because of all the inventory. There was just way too many apartments,” said Justin Martinez, a real estate agent for Nest Seekers International.
After the deal, Martinez said buyers were circling and prices rose.
“We were getting a lot of buyers who wanted to come to Long Island City and Astoria, who thought Amazon was going to come," Martinez said. "My developer friends said after Amazon said they were coming to Long Island City, sellers wanted 25 percent more for land prices. Buyers were willing to pay the asking price.”
"The reaction is shock," he said. “We think prices are going to back down to where they were prior to the news.”
Patrick Smith, an agent for Stribling, a luxury real estate firm, said he was disappointed both as a realtor and as a member of the community.
"I not only specialize in real estate in Long Island City, I also live here with my family," Smith said. "I think Amazon would have been great for the state.”
Not every realtor was disappointed by the news.
“I personally am thrilled that they are not coming," said Joanne Duffy of SheKnowsRealEstate. "When I heard that they were coming and what we allowed to have happened in order to get them, I was appalled, billions of dollars in tax cuts.”
Duffy added that she felt New York City did not need to offer tax incentives.
“Look, New York is the get," she said. "Being in New York is the get. Do you think the little guy who is coming to New York is being offered all these tax breaks?”
The realtors were still bullish on Long Island City.
Benaim noted that LIC was named the fastest growing neighborhood in America before the Amazon deal was announced.
"People don't buy in Long Island City because of Amazon," he said.
Smith added that the neighborhood's proximity and public transportation have already fueled growth.
"We have five subway lines that reach midtown Manhattan with one stop," Smith said. "We have a wonderful public school on the water. None of that changes. All of the great things about LIC remain.”