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NYBC Forecast: Construction Off From Recent Peak; Recovery Seen in 2006
Total construction spending in New York City is expected to reach $15 billion in 2004, according to New York City Construction Outlook 2003-2006, a report issued by the New York Building Congress and discussed at a recent forum with New York City Economic Development President Andrew M. Alper and New York City Department of Buildings Commissioner Patricia Lancaster, AIA.
While the forecast is down from a record-breaking $16.7 billion in 2003, this level of construction still far exceeds spending throughout the late-1990s. The report forecasts construction spending of $14.8 billion in 2005 and $15.8 billion in 2006.
“We are just beginning to dig out of the recession,” noted Lancaster, who predicted that New York City will benefit from approximately $40 billion in proposed construction spending over the next decade, thanks to such large scale projects as the rebuilding of the World Trade Center, expansion of the Javits Convention Center, a Brooklyn sports, office and retail complex, and the facilities needed for the 2012 Olympics.
The Building Congress report projects an increase in construction employment from 117,200 jobs in 2003 to 119,800 in 2004. Employment is expected to reach 118,600 in 2005 before rising to 126,500 in 2006, which would surpass the previous
construction employment record set in 2001.
“Despite a sluggish economy, high unemployment and budget deficits in City Hall
and Albany, construction spending and employment remained robust in 2003 and served as a stabilizing force for the City's economy,” said Building Congress Chairman Frank J. Sciame.
In describing his reasons for optimism moving forward, Alper said, “Everyone feels more confident. The City is busy. Restaurants are crowded. It's hard to get a cab. And economic indicators show growth in each of the last six months. What we need to do now is sustain this momentum.”
Among the Report's Findings:
- Residential construction spending reached $2.6 billion in 2003, producing
20,800 units of housing. The report predicts similar levels of construction
through 2006.
- Non-residential construction, which produced 16.9 million square feet in 2003,
will decline to 11.3 million square feet in 2004 and 6.5 million square feet
in in 2005, before rebounding to 9.7 million square feet in 2006.
- Public infrastructure spending reached $8.5 billion in 2003. The Building
Congress forecasts spending will reach $8.6 billion in 2004, $9.9 billion in
2005 and $9.8 billion in 2006.
The New York Building Congress prepared Construction Outlook with the assistance
of Urbanomics, an economic consulting firm. The full report can be viewed at the following link.
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