‘The Hamptons’ Is a One-Industry Place

 A “resort” community where there is no central commercial resort can still be a one-industry economy. In the case of the South Fork of Long Island (aka “Hamptons”), the one trick is luxury housing. There’s an extensive commercial/labor ecosystem to support it.

Of course, there are the houses themselves—nearly all of them being conceived big now, a few at 10,000 square feet or more. And during the pandemic, they’re being occupied for longer, which magnifies the demand for all the supporting businesses.

But first, they must be built or upgraded, likely then sold. After a brief interruption, Covid-19 has done wonders for that market. It brings a slew of custom contractors and their many “subs.” The realty agents flog the merchandise, sometimes before it is even finished. The lawyers and  fixers make sure everything passes muster with the seemingly tight zoning and other codes.

Once the new occupants are “living the life” (as one Hamptons developer markets it), the real parade begins. The bigger the house (and wallet), the more likely that designers will be employed, both inside and out. The furnishings and appliances must be procured and delivered. The landscaping appears—sometimes with mature bushes and trees—and after implanted must be tended to weekly for much of the year. (Don’t forget the leaf blowers and chippers in the fall, especially.) There’s all the plumbing (bathrooms galore!) and wiring, and nowadays much of the latter entails entertainment networks and related utilities. Eastern Suffolk has limited sewerage and natural-gas hookups, so there are septic and propane calls on top of the heating oil fill-ups. Plus the garbage pick-ups…and the many, many “priority” package dropoffs. Most homes have a pool of some sort, and require servicing for five or six months of the year, along with any tennis court. And, my goodness, you have to eat! Catering is for normal times, but during a health scare, PeaPod and DoorDash will be up your drive. If you are not in residence, there’s probably a caretaker or security patroller who is coming by to check on things.

Add all that up and you get virtually nonstop truck traffic on the often-winding roads, on top of the residents’ SUVs tending to their kids’ needs and other errands.  (The resident population is about 100,000.) As in other pricey areas, much of the “trades” inflow has to drive in and out each workday from less expensive digs miles away along a narrow strip. The backups only grow worse.

What do the data show about trades activity? Figures from the U.S. Bureau of Labor Statistics are imprecise as to this topic, but consider:  For the Nassau-Suffolk County (Long Island, N.Y.) region, “mining, logging, construction” employment grew 42% between March 2010 and March 2020, whereas all private-sector jobs were up less than 12%. (And construction, unlike other sectors, had almost fully rebounded by October 2020 from the pandemic dropoff.)

And what else? Artists can hope to find space in the great rooms or galleries. The South Fork still has some baymen looking after the maritime catch and modest commercial fishing out of Montauk, but this has dwindled with the fishery. The fabled duck farms are long gone, and other agriculture is mostly boutique, for the seasonal stands. The remaining potato crop goes into high-priced vodka distilling.

For one proxy of the growth of housing-trade services, I sought to find out how many more landscaping licenses were issued in 2019 versus 10 or 20 years before. My inquiry with the town of Southampton was rather aggressively denied—supposedly no such count can be made. The clerk for East Hampton simply didn’t respond. An earlier effort to get a commercial-vehicle count from the Southampton highway department yielded nothing.

Now, it’s true that today’s big, big homes usually mean that the South Fork will have fewer dwellings than it was once zoned for. But my observation is that the McMansions create more of the services demand listed above than their room count might suggest.  So: If an old-style, 4 bedroom-2.5 bath home on a shy-acre lot would generate two calls a week, a double-sized manor and grounds will account not for four calls, but more likely six or eight. It’s in the nature of the property and the folks who live there. Let’s just say you rarely see many of the new gentry doing their own lawn care or puttering around the 3-car garage to fix a chair leg.

This does make me wonder why planning regs can’t take into account the externalities involved in further development approvals. The lots have their various requirements on building setbacks and footprints, to protect neighbors (it is hoped). But what of the onslaught of attendants the new homeowner will require?

To be fair, the luxury-home boom has had its positives.  Some of the places are marvels to look at, and they are mandated to entail a goodly amount of native vegetation. More significantly, all sales in the Peconic Bay towns draw a 2% excise tax, which since 1999 has gone into land-preservation purchases and lately into minimizing incremental harm to the region’s natural and scarce water resources. (Gotta save the supply for all those bathrooms.) A $5 million transaction yields $95,000 for the fund (the first $250,000 of the price is exempt), and this year it has raised over $100 million through October. Plus these properties pay a lot of annual school taxes, which lowers the rate for everybody. The new wealthy inside them frequently support cultural and other nonprofit activity. Also, as an old newspaperman, I am gratified that the many pages of vanity advertising for the turnover of Hamptons estates keeps an ever-challenged local press in business.

If only “living the life” could be an indulgence experienced only by those most successful or fortunate. But the rest of us do cross paths with them, so to speak, and therein lies a rub.

December 18, 2020

Published by timwferguson

Longtime writer-editor, focusing on topics of business and policy, global and local.

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