Rental demand already is high along New Jersey's Gold Coast, but a new report said supply constraints in New York City will continue to feed multifamily development west of the Hudson River.
The report, TD Bank's Regional Multifamily Outlook, estimated 2,000 new apartment units will open along the Hudson waterfront by the end of 2015. The study also tracks about 4,000 units in the planning stages in the market.
In New York, the report anticipates more than 27,000 new units will open by the end of 2015, supported by projected growth in the number of adult households and flat home ownership levels. But its authors also point to the dearth of developable land in New York, which is "subject to strict zoning codes and is astronomically expensive," so demand may even outpace the new supply.
"While fears of overbuilding in the multifamily sector have plagued other metros across the U.S., there is little risk of this happening in New York," the TD report said, later adding, "As a result, builders have started looking beyond the city's vast skyline and are ramping up construction in nearby New Jersey."
Garden State developers already are jumping on a booming multifamily market, especially along the waterfront. Mack-Cali Realty Corp., the Edison-based real estate investment trust, said Thursday it will soon begin work on a 69-story, 765-unit residential tower in Jersey City with Ironstate Development.