Joe Farrell: How Volume Can Build Flexibility - 27 East

Real Estate News

Real Estate News / 1404751

Joe Farrell: How Volume Can Build Flexibility

icon 1 Photo
Joe Farrell in his office in Bridgehampton.  DANA SHAW

Joe Farrell in his office in Bridgehampton. DANA SHAW

author on Nov 4, 2016

Two recent million-dollar price cuts illustrate the business strategy of speculative builder Joe Farrell—to keep inventory moving “so you can move on.”“I love to get the money and put it to work again,” said Mr. Farrell, who’s diversified his portfolio to include a broad range of price points as well as geography—not only on both sides of Montauk Highway on the East End but also in Florida and upstate New York.

“We build in volume,” he said. “I don’t have to sit there and wait to make a fortune in one house.”

The price for a completed spec house at 423 Parsonage Lane south of the highway in Sagaponack was recently dropped by $1 million, to just less than $12.5 million. At 280 Highland Terrace in Bridgehampton, another Farrell house south of the highway, the asking price was chopped by $1.5 million to a hair short of $17 million.

Not waiting to get the highest price possible enables the developer to start a new project—often at a different price range or neighborhood that might be hotter at the moment. If the high end gets soft, for example, it helps to have inventory at a lower price point.

The Bridgehampton-based Farrell Building Company has its own architects, engineers, paralegals and excavators, among others. The company took a hit in the 2008 recession and had to lay people off, and Mr. Farrell said he doesn’t want to go through that again, even though the business eventually doubled in the years that followed.

“I went to a different business model,” Mr. Farrell said of a time following the recession when he transitioned from building $15 million to $18 million homes to $3 million to $5 million ones. “When next recession comes, I need work,” he said, and to that end he has any number of irons in the fire.

In addition to residential projects both north and south of Montuk Highway, they include two $30 million oceanfront homes just south of Miami, a self-storage building in Port Jefferson, a 92-bed assisted living facility in Fishkill, and convenience stores and a 163-unit apartment building in Newburgh, New York.

In the Hamptons, Mr. Farrell said he’s finding that land prices aren’t going down, but that there is less competition to buy the land. “Every builder and their brother, they’re all here,” he said, but “a lot of builders are tied up—their capital is tied up.

“I don’t wait—I like to be ahead of the curve,” the developer said.

You May Also Like:

Ezekills Hollow Sale For $14.5 Million Points To Growing Demand For Luxury Properties In Sag Harbor Area

The sale of a waterfront home on North Haven recently closed for $14.5 million, the ... 30 Nov 2020 by Brendan J. OReilly

First Neck Lane Estate Sells For $11.5 Million

A Southampton Village estate section home at 252 First Neck Lane recently sold for $11.5 ... by Staff Writer

Further Lane Estate Fetches $7.5 Million

A 2-estate Amagansett estate on storied Further Lane recently sold for $7.5 million, according to The Real Estate Report Inc. At 386 Further Lane, the property boasts a 9,000-square-foot stucco manor built in 2001. According to a Corcoran listing for the estate, the residence’s main floor has a dramatic great room, a children’s wing with two suites and a large play area, a guest suite and a state-of-the-art kitchen with an adjoining living room. Upstairs, a master wing offers a “sumptuous bathroom, an office, a sitting room and a large outdoor terrace,” and an additional bedroom completes the second story. ... 23 Nov 2020 by Staff Writer

Wickapogue Road Estate Sells For $8 Million

A Southampton Village estate dubbed “The Beachmont” sold and closed last month for $8 million, ... by Staff Writer

Wilkes Lane Estate Sells For $7 Million With Plans For Redevelopment

A 1.8-acre Sagaponack estate south of Montauk Highway that was listed for $8.5 million has ... 19 Nov 2020 by Staff Writer

Sagaponack Estate Fetches $9 Million

A Sagaponack estate overlooking 14 acres of farmland recently changed hands for $9 million, according ... 16 Nov 2020 by Staff Writer

Record Executive Buys Southampton Estate For $18 Million

A modern Southampton Village estate by builder George Vickers Jr. Enterprises recently sold for $18.1 ... by Staff Writer

Bayfront Property In North Haven Sells For $11.5 Million

A North Haven home on 4.4 acres of bayfront property recently sold for $11.5 million ... 12 Nov 2020 by Staff Writer

Kevin Sorbo Sells Bridgehampton Residence For $8 Million

“Hercules: The Legendary Journeys” star Kevin Sorbo and his wife, Sam Sorbo, an actress and ... by Staff Writer

Twenty-Five Condos Proposed On Site Of Dockers Restaurant

The owners of the 8.6-acre property in East Quogue where Dockers Waterside Marina & Restaurant ... 9 Nov 2020 by Brendan J. OReilly

Welcome to our new website!

To see what’s new, click “Start the Tour” to take a tour.

We welcome your feedback. Please click the
“contact/advertise” link in the menu bar to email us.

Start the Tour
Landscape view not supported