Investors Lining Up to Build New Projects in Orange County
John Jordan | September 23, 2021
MIDDLETOWN—If any attendees at the Sept. 21 Investor Breakfast of the Orange County Partnership were questioning the strength of the county’s economy, any misgivings were wiped away by the breadth of the positive data and forecasts offered by economic development, government and business experts at the event.
Orange County Partnership President and CEO Maureen Halahan noted that the county is seeing significant development interest and numerous firms are seeking municipal approvals for projects ranging in size from 60,000 square feet to 1 million square feet.
Halahan said that at present, the growth clusters in Orange County are: tourism, health care, distribution and e-commerce.
Orange County Executive Steve Neuhaus pulled no punches, reporting that sales taxes in Orange County are up 25% from last year and agreed with Halahan that investment interest in Orange County is very high.
“There is a massive land grab going on throughout the county,” Neuhaus said. “People wanting to buy property, investing and going before Planning Boards.”
He also said that the county is working with the Department of Labor to prompt those who left their jobs due to the pandemic to return to work if they are able.
The keynote speaker at the event held at the West Hills Country Club that was attended by 275 people, was Gus Scacco, CEO and Chief Investment Officer of Hudson Valley Investment Advisors, Inc. of Goshen, a subsidiary of Orange County Bancorp, Inc.
Scacco noted that demand is very strong and what is holding back economic growth are supply bottle necks. “You don’t confuse slowing sales with what is happening now because demand is tremendous” he said. “You can’t find employees, you can’t get a reservation, you can’t buy a car, you can’t find a house. Those don’t happen when you are having bad economic times.” He termed current economic conditions as “very robust” and noted that there are indications that the worst of the COVID-19 pandemic may be behind us.
He noted that supply constraints are putting downward pressure on growth. Scacco said that at present there are 60 large container ships sitting out in the waters off the port Long Beach, CA waiting to be off loaded. Normally, there are just three to five container ships waiting for longshoremen to offload their cargo.
Another impediment to growth for the national and regional economy is the shortage of computer chips, which has, for example, caused used car prices to rise by 30%. Scacco said there are signs that the computer chip shortage may be dissipating.
He said that inventories are very low and will likely take about a year to recover. Scacco predicted that supply chains will begin to turn to normal levels in the second quarter of 2022.
In terms of the housing market, Scacco said that the combination of low inventory and high demand, particularly among first time homebuyers will fuel a continued strong housing market for some time to come.
Another positive for the housing market, include continued migration of city residents to suburbs like Orange County.
“If you are a builder, this is probably the best time you have ever seen or will see for a long period of time,” Scacco predicted.
He agreed with Neuhaus and Halahan and said that there is a major push on the commercial construction for the development of warehouse space across the nation.
Another key positive indicator that spells good news for real estate investors and the overall economy is that the personal savings rate is currently at a record high of 15%. He said that the high personal savings rate is a key reason why some people have yet to return to work despite the abundance of open job positions.
“People are sitting with a lot of money in their pockets and they want to spend it,” he said.
He concluded his remarks by again reiterating that slow sales are not the real indicator of where the economy is and is heading in 2022.
“We have tremendous, tremendous buoyancy in the economy on a nationwide basis,” Scacco said. “The biggest thing that is holding us up are bottle necks in terms of logistics and the ability to get stuff. If you are a contractor waiting trying to get wire, you are waiting for a product at home or you are looking to add an employee, those are the things that we think will let up over the next six to eight months and keep the economy running.”
The Orange County Partnership’s next major event will be its Annual Event held on Tuesday, Dec. 7 at the recently opened The Barn at Villa Venezia in the Town of Wallkill. At the program, which will begin at 5 p.m., the Orange County Partnership will announce the winners of its 2021 Quality of Life Award, Spirit of Innovation Award and the Alliance for Balanced Growth’s Golden Shovel Award.