What the 2nd Avenue Subway Line Could Mean for Real Estate on the UES Industry Pros Talk About the New Subway’s Possible Impact on Properties

Inside the new 86th Street subway station on Second Avenue (David Chiu)

In movie industry parlance, New York City’s Second Avenue subway line was in ‘development hell’ for almost 100 years—as many Upper East Siders who ride the very crowded Lexington Avenue subway train daily know first hand. Plans for the new line were first proposed in 1929 but later interrupted by World War II. It wasn’t until the 1970s that federal funding arrived to build the line, only to be halted again due to the city’s fiscal crisis. After nearly three decades, ground finally broke at the 96th Street station in 2007 following the passage of the state’s Transportation Bond Act two years earlier.

Now what was only a fantasy has now become reality as the first phase of the Second Avenue line (estimated to cost $4.4 billion, The New York Times reports) went into operation on January 1. It consists of the Q train running past 57th Street-Seventh Avenue through 96 Street-Second Avenue—with new subway stations 72nd Street, 86th Street and 96th Street dotted along Second Avenue, as well as a renovated Lexington Avenue/63rd Street station. According to the Metropolitan Transit Authority, the first phase of the line is expected to carry 200,000 riders daily; alleviate crowding on the current Lexington Avenue line by 13 percent, or 23,500 riders on an average weekday; and reduce travel time for Upper East Side riders by 10 minutes or more. (The next phase of the project will include stations in Harlem, East Midtown, East Village, Lower East Side, Chinatown and Lower Manhattan).  The MTA is also touting newly-installed permanent public art at the 63rd, 72nd, 86th, and 96th Street stations, the largest in the state’s history.

New Developments in the Neighborhood

But it’s not only residents and commuters of the East Side who are celebrating with the new Second Avenue line--New York’s real estate market could stand to benefit from this latest addition to the city’s mass transit system. Prior to the opening, the area has been teeming with development. According to Halstead Property Development Marketing, there are about 19 new projects under construction from 59th Street to 96th Street, the New York Post reports.  Among the projects that are happening in the vicinity of the Second Avenue subway include luxury condo Citizen 360 at 360 East 89th Street; the Charles, a condo tower on 1355 First Avenue; the Kent at 200 East 95th Street; and rental-to-condo conversion Carnegie Park at 200 East 94th Street.

“I've seen what's been going on, both good and bad,” says Beth Benalloul, a broker for the Corcoran Group and a resident of Second Avenue. “Already you're seeing so much new development in the area and I think even more slated to come, knowing that the transportation options are going to open up on Second Avenue. I think that's the big deterrent for purchasers and for renters because the transportation option was limiting.”

Joel Burris, executive director of Brown Harris Stevens and president of the Ruppert Yorkville Towers condo on Third Avenue,  also sees the benefit of the new line. “I think most Upper East Side residents as well as people who work there are very excited.It will alleviate crowding on the Lexington Avenue line between 96th Street and 59th Street, which is always an incredibly crowded station in the mornings...I think it will make people who live on East End and 1st Avenue and York as well as Second and even Third have an option on how to get to work." However, Burris offers a somewhat different point of view on whether the lack of one previously was a crutch for people buying homes. “I think that people were used to the thought of having to commute over to Lexington Avenue,” he says. “I didn't hear people say, ‘I wouldn't live on Third Avenue or Second Avenue because it was too hard to get to the subway.’”

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