March 1, 2017
By Stephanie West
New York, NY - The value of New York City construction starts reached $32.2 billion in 2016, a decline of 22 percent from 2015, according to a New York Building Congress analysis of construction data from Dodge Data & Analytics.
While the overall value of last year’s construction starts is down from $41.1 billion in 2015, the 2016 total easily outpaced the annual average of $24.1 billion in construction starts achieved during a five-year period stretching from 2011 through 2015.
“Despite our inability to match the epic pace of new project starts achieved in 2015, private sector developers and real estate investors maintained their incredibly bullish outlook on New York City in 2016,” said New York Building Congress President and CEO Carlo A. Scissura. “With government work included, the five boroughs have been home to more than $70 billion in new construction projects over the past two years, with much of that work continuing to course through our economy today in the form of new jobs, additional consumer spending, and increased tax revenue.”
From start to completion, the construction projects initiated in 2016 will encompass 51.3 million square feet of new floor space. That total is down nearly 38 percent from the 82.2 million square feet of new space started in 2015, but remains well above the five-year average of 44.4 million square feet in construction projects initiated between 2011 and 2015.
A cooling off in the residential sector accounted for nearly all of the drop in 2016 construction. After soaring to $19.5 billion in 2015, the value of residential construction starts dropped to $11.5 billion in 2016, which easily surpassed the average of the previous five years. While non-residential construction, which includes offices, hotels, schools, hospitals, transit stations, power plants, and other institutional buildings, dipped slightly – from $18.0 billion in 2015 to $17.3 last year – this sector remains a major source of construction jobs and spending. The value of non-residential construction starts reached $10.9 billion in 2014, $8.4 billion in 2013, and $9.6 billion in 2012. Construction starts in the public works sector dipped for the third consecutive year. Projects initiated in this sector, which includes roads, bridges, subways, water and sewer systems, and other infrastructure, reached $3.4 billion in 2016, down from $3.6 billion in 2015 and $3.8 billion in 2014.
“Our biggest concern right now is the relative lack of new investment to improve and add capacity to the transportation and infrastructure systems that will be relied upon to accommodate all of the private sector investment occurring throughout the city,” noted Mr. Scissura. “The good news is that both Governor Andrew Cuomo and Mayor Bill de Blasio have recently detailed big plans to improve the region’s airports, mass transit, water and other essential public works.”