Amazon’s Move to Millennial Hubs Long Island City and Crystal City Expected to Spark an Apartment Boom

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According to reliable sources, including The New York Times, Amazon is set on equally splitting its second headquarters between Long Island City of Queens and Crystal City in Arlington, VA. In light of these events, it’s worth taking a closer look at how this decision will ultimately impact those living in or moving to the two areas in terms of rents and apartment supply. With about 50,000 new employees, are the two locations ready to accommodate this many people as far as rental housing is concerned?

Both neighborhoods have witnessed above-average increases in the monthly rent over the past year. The average rent for apartments in Crystal City is currently $2,387 per month, 5% more expensive than one year ago. Meanwhile, Long Island City apartments are already seeing steep prices, with the average monthly rate at $3,458 as of October 2018, 5.1% above last year’s prices.

LIC and Crystal City will see a significant increase in apartment construction

The Amazon move is bound to have an impact in terms of apartment construction, not only on the specific neighborhoods about to become its second home, but also on the surrounding areas. With a high occupancy rate of 98.2% in LIC, future Amazon employees may have a hard time finding an apartment for rent near work.

However, given Amazon’s choice to move a part of its HQ2 in Long Island City, there’s a good chance that the neighborhood will witness an outstanding apartment boom in the years to come. A total of approx. 15,400 units are under construction at the moment, planned or in a prospective phase. Amazon’s announcement is definitely bound to speed up the apartment construction in the area, which is already seeing an increased number of new apartments entering the market.

LIC is New York City’s hottest neighborhood, but also in the U.S., according to a recent RENTCafé study, with the newest apartments delivered after the recession. More than 12,500 units in 41 apartment buildings were completed here between 2010 and 2016.

The situation is quite different in Crystal City, where there were no major developments in the last couple of years. Still, the area exhibits a healthy 94.7% occupancy rate, below the national level, which is 95.2%. Approximately 3,100 units are under construction, planned or prospective. But thanks to the transit systems in the Washington metro area, future Amazon employees would have access to more than 205K rental units currently in the entire metro.

It’s worth noting that both Long Island City and Crystal City have about the same share of high-end or luxury apartments, 58% and 56% respectively. This would give prospective renters a wide pool of choices when searching for apartments.

Both neighborhoods boast high shares of Millennials and highly-educated population

What type of employees is Amazon expected to find here? As of 2016, Crystal City boasts a 52% share of Millennials, up 22% from 2011. LIC, on the other hand, has a Millennial population of 43%. However, one LIC ZIP code, 11109, made it on our Top 20 Millennial Hot-Spots in the Nation with a 63% share of Millennials.

The median household income in Crystal City is almost double than in Long Island City: $107,478 vs. $54,109. Also, the percentage of people holding a Bachelor’s degree or higher in Crystal City is a whopping 85%, while in LIC it’s about half that, 45%. This data gives a good indication that knowledge workers – the kind of employees that Amazon envisages it will most need – would be found in both LIC and Crystal City.

Source: rentcafe.com