Construction activity in New York remains up for the year, but collapses in the second quarter
- New York City new building filings in the second quarter jumped 19% year over year, according to the New York Real Estate Board.
- But new building filings in the second quarter reflect a 39% drop from the previous quarter.
- Still, it’s important to note that the first quarter saw the highest number of filings since the fourth quarter of 2014, according to the report. The 422 new building filings in the second quarter “show the strength of the city’s construction and development sectors,” said James Whelan, president of REBNY.
Overview of the dive:
Construction activity in New York remained strong in the second quarter of 2022 despite economists debating whether the The United States is currently in or heading into a recession.
Brooklyn saw the most filings of any borough with 122, a 45% year-over-year increase. While Manhattan continued to account for the lowest number of filings with 29, the figure is a 61% year-over-year increase, according to the report.
Brooklyn leads NYC in new building filings in Q2
|Borough||New build records||Year-over-year variation|
SOURCE: New York Real Estate Board
But while construction activity in New York remained strong in the second quarter, the signs are starting to show at the national level for the economic challenges ahead. Construction contractors’ order book fell for a second consecutive month in July, while profit forecasts fell further into negative territory, according to a statement from Associated Builders and Contractors.
Second quarter 2022 filing volume, while rated strong by Whelan, was below historical norms. The 422 filings are 13% below the median and 16% below the average since 2008, according to the report.
Construction and real estate account for 20% of New York City’s GDP while providing 10% of jobs and 5% of wages, said Lou Coletti, president and CEO of the Building Trades Employers Association. Carlo Scissura, president and CEO of the New York Building Congress, urged finding ways to keep up the pace of activity.
“Our city has made significant progress since its darkest pandemic days, and our industry continues to lead the way,” Scissura said. “We have to find ways to maintain this momentum.”
Total proposed construction square footage in the second quarter of 2022 followed the same trend as the number of filings, with a significant decrease from the prior quarter, but a year-over-year gain.
The 15 million square feet of construction proposed in the second quarter represents a 36% decrease from the first quarter, but reflects a 69% increase from the second quarter of 2021, according to the report.
The largest proposed projects in each borough in the second quarter of 2022 include a 986,360 square foot warehouse in the Bronx, a 749,356 square foot mixed-use building in Brooklyn and a 667,302 square foot residential building in Manhattan, according to reporting.
Gary LaBarbera, chairman of the Greater New York City Building and Construction Trades Council, called for continued investment in public works and development projects to maintain momentum.
“This latest report makes it clear that New York’s ongoing economic and social comeback is being led by new buildings and construction,” LaBarbera said. “It is paramount that these initiatives continue to be a priority if our city is to continue its upward trajectory after the devastation left by the pandemic.