People's Arc of Suffolk to sell Bohemia headquarters
People’s Arc of Suffolk has listed is Bohemia headquarters for sale. Credit: Newsday/James Carbone
A major Suffolk County nonprofit plans to sell its Bohemia headquarters and reinvest the proceeds in its programs for people with intellectual and developmental disabilities.
People’s Arc of Suffolk, formerly known as AHRC Suffolk until a rebrand last month, said it is looking for buyers for its home office since the mid-1970s to raise money as nonprofits serving people with disabilities contend with staffing shortages.
The nonprofit is listing the property in a challenging commercial real estate market in which demand for office space, particularly in non-prime locations and in older buildings, has fallen and industrial tenants have a variety of new warehouses to choose from, said Mateusz Wnek, associate director of market analytics at CoStar Group, which publishes commercial real estate data.
The 74,000-square-foot facility at 2900 Veterans Hwy. was originally designed as a warehouse and has several loading docks and a commercial kitchen. Within the building, there is 39,000 square feet of warehouse space and 35,000 square feet of office space.
The building has been appraised at $15 million, said Chris Veros, the nonprofit's chief financial officer. He declined to disclose an asking price, which he said would be dictated by the market.
"This is our biggest opportunity to reinvest in our programs, in our staff, and through the sale of this building, to get a rightsized building that would have less carrying costs," he said.
People's Arc, which has roots on Long Island dating to 1949, offers a variety of housing and employment services for people with intellectual and developmental disabilities. It helps people live independently in apartments or group homes and offers day programs, vocational training and employment services.
Until 2021, the Bohemia site was home to a sheltered workshop, where people with disabilities assembled products. People's Arc has shifted toward a model aimed at creating opportunities for clients to work in communities, not apart from them in a separate industrial site, Veros said.
"We're hoping to set up hubs in the community," Veros said.
In September, it opened the People's Arc Performing Arts Center of Northport to people with autism and other developmental disabilities express themselves through the performing arts.
Veros said the nonprofit is open to potentially leasing space from the buyer of the property in Bohemia and is also looking for a site on the South Shore. People's Arc has 42 sites in Suffolk, including 34 residences. He hopes to find a site that will reduce travel times for its clients and their families.
The nonprofit has informed families served at the Bohemia site about the change and there will be no disruption to services while the building is up for sale, he said.
About 131,000 people with developmental disabilities statewide qualified to receive services through Medicaid in the 12 months ending June 30, 2023, according to the latest data from the state Office for People with Developmental Disabilities. That includes about 16,000 people on Long Island.
People's Arc had about $70 million in revenue last year, mostly from Medicaid reimbursement for services, and reported a $485,000 surplus after expenses, Veros said.
In recent years, disability nonprofits have voiced concerns about staffing shortages, high turnover and inadequate reimbursement. In January, New York Disability Advocates, a statewide coalition of about 300 nonprofits, published a survey finding 25% of all direct support professional roles at nonprofits were vacant statewide.
As the minimum wage nearly doubled in the past decade, the wages offered by these nonprofits became comparable to those offered by fast food restaurants and retailers for jobs that require significant responsibilities, said Wini Schiff, CEO of the Inter Agency Council of Developmental Disabilities Agencies in Manhattan.
"Because we were underfunded for so many years, we had to let salaries slip," she said.
The industry is seeking a 7.8% increase in Medicaid reimbursement in next year's state budget to help nonprofits keep up with inflation and address inadequate payment increases over the past two years, Schiff said.
Wnek, of CoStar Group, said the Bohemia property might be a candidate for redevelopment because the older building is competing against newer offices and warehouses for tenants.
Selling points of the property include its frontage on Veterans Highway, its proximity 3 miles from Long Island MacArthur Airport and its connection to public sewers, said Alison Brennan, CEO of First Development Corp. in Islandia, which is listing the property.
She said its next owner could position the building as a retail, office or industrial space.
"It's definitely a unique asset," Brennan said. "We see the value in it because the zoning does allow for a lot of various different uses, so we're looking to repurpose the property to best fit whatever the community needs."
A major Suffolk County nonprofit plans to sell its Bohemia headquarters and reinvest the proceeds in its programs for people with intellectual and developmental disabilities.
People’s Arc of Suffolk, formerly known as AHRC Suffolk until a rebrand last month, said it is looking for buyers for its home office since the mid-1970s to raise money as nonprofits serving people with disabilities contend with staffing shortages.
The nonprofit is listing the property in a challenging commercial real estate market in which demand for office space, particularly in non-prime locations and in older buildings, has fallen and industrial tenants have a variety of new warehouses to choose from, said Mateusz Wnek, associate director of market analytics at CoStar Group, which publishes commercial real estate data.
The 74,000-square-foot facility at 2900 Veterans Hwy. was originally designed as a warehouse and has several loading docks and a commercial kitchen. Within the building, there is 39,000 square feet of warehouse space and 35,000 square feet of office space.
WHAT NEWSDAY FOUND
- People's Arc of Suffolk, a nonprofit serving people with disabilities, is putting its Bohemia headquarters on the market as it shifts more of its services into community spaces.
- The part-office, part-warehouse building was appraised at $15 million but faces a challenging commercial real estate market for older buildings.
- People's Arc hopes the sale will generate cash it can use to reinvest in its programs at a time when nonprofits are struggling to hire staff and reduce turnover.
The building has been appraised at $15 million, said Chris Veros, the nonprofit's chief financial officer. He declined to disclose an asking price, which he said would be dictated by the market.
"This is our biggest opportunity to reinvest in our programs, in our staff, and through the sale of this building, to get a rightsized building that would have less carrying costs," he said.
Nonprofit's roots on LI
People's Arc, which has roots on Long Island dating to 1949, offers a variety of housing and employment services for people with intellectual and developmental disabilities. It helps people live independently in apartments or group homes and offers day programs, vocational training and employment services.
Until 2021, the Bohemia site was home to a sheltered workshop, where people with disabilities assembled products. People's Arc has shifted toward a model aimed at creating opportunities for clients to work in communities, not apart from them in a separate industrial site, Veros said.
"We're hoping to set up hubs in the community," Veros said.
In September, it opened the People's Arc Performing Arts Center of Northport to people with autism and other developmental disabilities express themselves through the performing arts.
Veros said the nonprofit is open to potentially leasing space from the buyer of the property in Bohemia and is also looking for a site on the South Shore. People's Arc has 42 sites in Suffolk, including 34 residences. He hopes to find a site that will reduce travel times for its clients and their families.
The nonprofit has informed families served at the Bohemia site about the change and there will be no disruption to services while the building is up for sale, he said.
About 131,000 people with developmental disabilities statewide qualified to receive services through Medicaid in the 12 months ending June 30, 2023, according to the latest data from the state Office for People with Developmental Disabilities. That includes about 16,000 people on Long Island.
People's Arc had about $70 million in revenue last year, mostly from Medicaid reimbursement for services, and reported a $485,000 surplus after expenses, Veros said.
Staffing shortages, high turnover at nonprofits
In recent years, disability nonprofits have voiced concerns about staffing shortages, high turnover and inadequate reimbursement. In January, New York Disability Advocates, a statewide coalition of about 300 nonprofits, published a survey finding 25% of all direct support professional roles at nonprofits were vacant statewide.
As the minimum wage nearly doubled in the past decade, the wages offered by these nonprofits became comparable to those offered by fast food restaurants and retailers for jobs that require significant responsibilities, said Wini Schiff, CEO of the Inter Agency Council of Developmental Disabilities Agencies in Manhattan.
"Because we were underfunded for so many years, we had to let salaries slip," she said.
The industry is seeking a 7.8% increase in Medicaid reimbursement in next year's state budget to help nonprofits keep up with inflation and address inadequate payment increases over the past two years, Schiff said.
Tough real estate market
Wnek, of CoStar Group, said the Bohemia property might be a candidate for redevelopment because the older building is competing against newer offices and warehouses for tenants.
Selling points of the property include its frontage on Veterans Highway, its proximity 3 miles from Long Island MacArthur Airport and its connection to public sewers, said Alison Brennan, CEO of First Development Corp. in Islandia, which is listing the property.
She said its next owner could position the building as a retail, office or industrial space.
"It's definitely a unique asset," Brennan said. "We see the value in it because the zoning does allow for a lot of various different uses, so we're looking to repurpose the property to best fit whatever the community needs."
Jonathan LaMantia covers residential real estate and other business news on Long Island. He previously covered the business of health care for Crain's New York Business.
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