Land Rush in Connecticut

The old saw, that they aren't making any more land, is still true.  The pandemic has made people look for room to spread out, whether it be to live or to work. We've been seeing more land sales as a result.  

It's probably also because land is harder to finance, and requires more money down.  Money is cheap now, and also doesn't have a lot of value just stored in a bank.  In addition, most people with investments have seen them go up in value, so they have cash with which to diversify.

 

Given our prime location in Connecticut, between NYC and Boston, land should be at a premium.  And, since so much of what's already built is being repurposed for newer uses, it makes the cost of building from scratch look less steep.  Plus, you can have exactly what you want. The lack of supply feeds into this too.  If you can't find it, build it yourself.

 

Finally, entrepreneurship is at a high level these days.  Risk takers take other risks as well.  Building is often seen as riskier than buying an existing property, and certainly building on spec is always a risk.

  

What does this all mean?  If you have land, now just might be the best time to sell.

Land is Getting Action

Based on the calls coming into our office, buyers are interested in buildable land.  Much of what is on the market is not to the specifications of many buyers, and they are increasingly interested in perhaps just building from scratch, and getting exactly what they want.  In addition to being able to choose size, layout, and materials, they are also benefiting from the latest in environmental technology, so that they are lowering the costs of operation.

Do you have any empty acreage, or extra land where your current facility is, that you might be willing to sell?  This is the time to thing about doing just that.  There are buyers out there, and you could be in front of them shortly.  Why not capture the value and put it to work for you elsewhere in your business?  You could even think about a long-term land lease, if you're really worried that someday you might need the property, or that the value will be lowered, if the option for more land goes away.  If you can think of a scenario that makes sense for you, we can work with that!

Finally, Some New Development in New Haven

For too many years now, there has been little to no commercial development in New Haven.  Development goes in cycles everywhere, because, when there is a downturn in the market, there is no financing (or even appetite) for new projects.  In addition, there is often leftover space from buildings that have already been constructed or converted.  New Haven, as in all Connecticut cities, also has almost no clean land on which to build. 

All these factors mean that we haven't seen much that's new--outside of residential rental--in quite some time.  Just now, there are several things in the approval, preconstruction, or construction phase.  The biggest is a new proposed mixed-use project on the old Coliseum site, which replaces the prior proposal, scuttled when the market turned down.  Route 34 has more than one medical or biotech building in the works, and there is a big office building going up on College Street.

Other firms from out of the area are looking here as well, because of our housing, entertainment, and educational opportunities, particularly for younger workers, who choose city living more often than not. New Haven is more affordable than Fairfield County, New York, or Boston, but can be easily reached by train.  More residential projects are in the planning phase also, since there is a theory that we could provide housing for commuters.  For example, 360 State Street, which filled up faster than anyone predicted, sends 85% of its residents to work by foot, bicycle, or train.  Since that's a trend of the future--easy commutability--it's not a bad bet to think it will continue.  Those who flock here for dining, nightlife, and the arts may increasingly choose to live here, especially as young professionals or empty nesters.

This is all good news for New Haven, and for the real estate industry, and it's about time.  We're ready!