A new trend: Homeownership is going down and apartment living is going up. So why do we have to give iStar a tax break?

A new trend: Homeownership is going down and apartment living is going up.  That’s totally fine, but why do homeowners have to give apartment operators a tax break? AvalonBay who partners with iStar will profit from this trend.

CNBC: Homeownership rate drops to 63.4%, lowest since 1967

“The number of occupied housing units grew, but all on the renter side. The number of owner-occupied units fell from a year ago.

“Our results for the second quarter and year to date exceeded our original outlook,” noted Tim Naughton, chairman and CEO ofAvalonBay, one of the nation’s largest apartment REITs, in the company’s second-quarter earnings release out Monday. “For the balance of the year, we expect accelerating apartment demand to support stronger performance across our business.”


Here is something else for you to read as you prepare to pay your City of Long Beach taxes, due by 07/31/2015. CNBC: AvalonBay reports 2Q results


31 Replies to “A new trend: Homeownership is going down and apartment living is going up. So why do we have to give iStar a tax break?”

  1. Per iStar, the new buildings are expected to employ 16 people in the first year, 23 after two years and 30 after three years. These jobs are expected to pay $30,000 – $45,000 per year.

    Assuming the project does create 30 jobs at an average salary of $40,000. With a $130.1 million tax break it costs $4.34 million to create one job. Spread over a 25 year tax abatement, the cost is $173,467 each year to create a $40,000 job.

    Join the group:

  2. according to Newsday, The Nassau County I D A just granted the developer of the Nassau Coliseum less than 5 million dollars in tax abatements. They expect to employ over 500 people full time once it opens for business. In addition, they are expected to generate 2.7 million dollars in sales taxes annually. That’s in addition to paying full real estate taxes

    Compare that to the approximately 130 million dollars in tax abatements iStar and their partner Avalon Bay want, along with the tiny staff necessary to run two apartment buildings, and virtually no sales tax from 100 x 110 square feet of retail space.

    That cartoon says it all.

  3. And you are forgetting the new city and school employees needed to support these buildings – once it goes “Rockaways”, the number of police alone LB will need to add will probably be over a million a year in costs to the taxpayers. Maybe they can relocate the shotspotter speakers over to it to save some $$$s.

  4. Everyone needs to realize that tax increases on current residents is not the issue for City Hall. They know they are going to raise them drastically. Their concern is the timing and notice-ability. They know we are on a precipice of affordability and possibly an exodus. When that comes down, they will be on the first lifeboat. Why else would City Council have the unmitigated gall to try to sneak in a vote on pensions and lifetime health benefits after only 5 years? They are thinking short term and self preservation. I’ve said it before – Long Beach residents are, for the most part, not smart, apathetic, and uninvolved, when it comes to matters of politics, city finance, and taxes. They get starry eyed at skate parks, bike rentals, and food trucks. All of that is just band-aids on a leper. The size of LB City Government, teachers union, municipal employees, and their extended families is so huge that it almost assures you a political victory. I’d vote for a 15% tax increase if it meant a 20% raise. Concerning the above issue, Anthony asked the the question “WHY THE F*** ARE THEY GETTING A TAX BREAK?”. They are getting it. The next question you should be asking is WHY THE F*** WOULD ANYONE (other than the aforementioned) VOTE FOR THEM?

  5. The rents and taxes are outrageous enough here for the average Joe, so why give these money grubbing cooperations tax break. Just ask some of the tenants in these “luxury” rentals about the rent hikes they have been getting.

  6. Personally, I don’t know how LB has remained as affordable as it is for as long as it has. There aren’t a lot of East Coast beach front properties where that is the case.

  7. Affordable ??
    Ask someone that resides in buildings like the Avalon, or the White Sands, or any of the others around there, I doubt if they think it’s affordable.

  8. @West End Tom — I’ve been asking the same question for years. Our values are lower than most of the Jersey Shore’s, yet the amenities here are three-fold. I can only speculate why our property values remain lack-luster.

    Record high taxes give a property owner the feeling of being mere tenants. High visibility of bars, group rentals, summer crowds and their maladies overshadow the family-friendly reputation that would increase values. Political in-fighting and a reputation for corruption in government, condominiums and schools further taint Long Beach’s reputation. Shootings and crime, as few as they are, make headlines.

    But the real cause for low values I believe is a shortage of buyers. Young professionals lack the buying power of their parents, and older relocating families are fleeing the liberal highly taxed states like New York that penalize higher earners.

    The problem’s not just a Long Beach one. I think it’s shared by the entire demographic.

  9. @aimee – if they can afford it, it’s affordable. If they can’t they can move to some other 1 bedroom on the beach under $1,500, be in the same neighborhood, and be paying considerably less. Those are luxury buildings. The price tag should reflect some exclusivity.

  10. You want a job with the Republicans and/or you want your family and friends hired back. Or maybe you work for the union now and want to get some sort of promotion.

    Get a life.

  11. Before I get accused of being a city worker or something save your breath. I just love long beach and am happy with the direction we are going in. My city taxes went down each of the last two years by the way (assessments?).

    ANTHONY, please stop with the political stuff. Stop with the negative stuff. This is my favorite city in the world and I have lived in about a dozen cities in four different states.

    Love LB or leave it. All this political crap on facebook and here is nauseating and I will probably take a hiatus from reading until after November.

  12. Quality of life is the problem here – population density too high, tourist density is insanely high and they have the run of the City, what good are the seasonal “amenities” if the tourists are the only ones using them. To be a high end locale and attract the demographic you note, you have to have some exclusivity (like Point Lookout). Long Beach has just the opposite – not only doesn’t it have any exclusivity for residents, but actually reduces the exclusivity for the residents to below that of the tourist. There isn’t a single oceanfront community that allows tourists to park freely on residential streets like LB does to the 100% mark of available spaces every summer weekend – Cape Cod, the Hamptons, Florida – no where else but here. And City government just keeps adding more events, now even in the fall and spring – because as was said above, most of the residents here are star-struck by fairs, pub crawls, a bankrupt hotel that pays no taxes which most residents view as the “crown jewel” of the City, etc. Most voters seem to love it, elections are a mere formality in LB.

  13. @sam and @sandra – it must be a quality of life thing, but some of the important ones named are relatively new (shootings, high taxes).

    I don’t think taxes alone are enough of a reason – New Jersey has taxes higher than NY and real estate values are high. Rich people can afford high taxes.

    Other parts of Nassau/Suffolk have high taxes, and are priced higher than LB despite LB being their beach of choice.

    Is parking really what has kept lb values down?

  14. @Tom, much of the Jersey Shore has huge parking problems – much worse than ours. Nothing exclusive about many Shore villages, no public transportation, far less amenities yet much higher property values.

    We have great public transportation, easy accessibility to good highways and lots to do.

    Perhaps those work against us? Is Long Beach viewed as just another Long Island Bedroom Community? I understand the tourist activity that our City Council plugs is a mixed blessing. I’d prefer a quieter Long Beach.

    Tourism brings exposure, both good and bad. It’s better than being identified with the mutants’ crime sprees in the Projects.

  15. @sandra – but do the parking woes of NJ spill over to the residents? Or do they all have their own driveways? Can they invite friends over to a bbq knowing that they’re guests won’t spend 45 minutes looking for a space?

    I just don’t know, but I know it’s more expensive to buy/rent there, and there are much more amenities.

  16. It’s been ab absolute zoo near Pacific this summer, very frustrating to feel trapped on the weekends…and most weekdays. I’m pretty sure no one has a job except me haha.

  17. Parking and taxes are a major player in why I’m disgruntled, but not the only things. Long Beach is a 1/2 mile wide sand dune and there are areas in which I do not feel safe and there are multiple shootings. The transportation hub has it’s share of vagrants, thieves, and human waste. I refuse to shop in Waldbaums for a multitude of reasons and go to Oceanside instead. I have never, and will never, eat at a Long Beach food truck in a parking lot next to what amounts to an abandon lot. So far I have not needed to use our 8 million dollar bathrooms. I avoid even moving about in Long Beach at certain times of day as it is too congested, and yes, there is no where to park. City services do not operate efficiently. Drainage is abysmal during rain storms. Roads have been left to crumble. We overwhelmingly topped the Newsday list of highest salaries and overtime. Our school district has become marginal and yet school taxes climb and they saw fit to build another stadium. We are staring down the face of even higher taxes as a result of poor choices by our elected officials. One can’t help but finger point. The PD needs to address crime, Public Works needs to address infrastructure, a Commerce department needs to sit with a Transportation Director and hammer out parking and moving people efficiently around town while supporting businesses. Can someone please tell me what improvements we see around the City since Sandy? Remove the smooth new boardwalk from the equation and tell me what exactly, after well more than two hundred million dollars have poured into this city, has been improved upon that your quality of life has gotten better?

  18. Great advice, you should have a TV show.. Or pardon me, Dr. Phil already does.

    Do you think that just because they could afford it that mKes it right?
    And why would someone who may need two bedrooms move to a one bedroom?
    Can you answer that Dr. Phil?

  19. Please find me a building On The Beach for $1500.00, mr West End Tom?
    Please don’t post things thAt are untrue, or are you just making things up to suit your postings,

    There isn’t any thing on the beach worth spit for $1500.00.
    I know it for a fact, so please don’t post false info.
    Thank you
    The Doctor

  20. You people who are posting about the bad parking situation, just think about how things will be if these monstrosities of buildings go up that Istar and Avalon want.
    There will be 100’s of more cars and add to that they’re will be no place for the volleyball players, the tourists , the fair goers, etc. to park.

  21. I e been told that the tenants who live in the Avalon Re moving out in droves becouse of very high increases in their rents. And most are moving out of town.

  22. There’s a TON of political stuff that I’ve been purposely keeping off the blog. Sorry to see you go. Perhaps I’ll join you because I don’t like the political stuff either, but iStar and the Superblock is a major issue. Is it politics or a rich corporation attempting to make money off us?

  23. I lived in LB in the late 70’s. 855 E. Bdwy and my rent was $465 a month for 2 bds., huge terrace facing water. That same apt. is now a totally over priced condo. The furniture in the lobby looks like it came from a Coney Island thrift store, the lobby smells like Raid mixed with cheap cologne, the hallways can be compared to low income housing projects. Next, The Avalon…ask for a tour then sit with one of the sales people and try to style composed. The tenants are charged for everything and I mean everything. I believe a cat costs $650 for the duration of your lease plus $50 a month. Now ask about rent increases…ready for this? Answer “whatever the market allows”. The apartments aren’t worth it.

    I’ve been looking for a condo in LB for a few months as I am downsizing from 3 bedrooms to one bedroom. I refuse to spend more than $250,000 since the rooms are small and most views are facing another building, construction site, parked cars or inebriated adults (I helped a man a few weeks ago who fell off his bike after drinking with his friends. He couldn’t find his car).

    I’m persistent not stupid. I’ll do my research and if it turns out low-income is on the rise while taxes go up then I switch to Plan B.

    I’ve lived in NYC, Brooklyn, Boston, Oklahoma (military housing) and overseas. One thing I suggest, FIGHT and NEVER GIVE UP.

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