NEW YORK CITY-The continued strength of the multifamily market—and developers' confidence in the sector—is evident in new research that shows a significant decline in stalled construction sites earmarked for residential projects and, to a lesser extent, mixed-use developments.
The number of stalled construction sites throughout New York City has dropped by 12% this month—compared to November 2012—to 610 from 690, according to a New York Building Congress analysis of New York City Department of Buildings inspection records. And the number of stalled sites citywide is on a steady decline: it peaked at 709 in November of 2010.
Yet, given the strength of the housing sector and the city's healthy recovery, the numbers should be better, NYBC president Richard Anderson tells GlobeSt.com. “I'm surprised the numbers aren't dropping faster,” he says. “We've been over 6,000 units every year since the downturn in 2009, but the units being built are upper income in Manhattan, the boroughs haven't caught up.
Indeed, Brooklyn's tally has declined by 17% since last November, but the popular borough has 267 suspended projects. Queens ticked down just slightly from 169 to 165 while Staten Island has 45 stalled sites, which is down from 50 in November of 2012. The Bronx was the only borough that experienced an increase in the number of delayed developments—from 26 in November 2012 to 43 in November 2013.
By contrast, the number of stalled sites in Manhattan dropped 26% over the past 12 months—from 122 in November 2012 to 90 in November of this year. The Manhattan total dropped to 98 in late June, which marked the first time in more than three years that the number of stalled sites had dropped below 100.
The list of newly restarted projects is highlighted by a number of luxury residential developments in Lower Manhattan, including the Renwick Modern in Hudson Square, as well as two large-scale condominium projects at 56 Leonard St. and 5 Franklin Pl. in Tribeca. In addition, construction of Silverstein Properties' Four Seasons Hotel and Residences at 30 Park Place is expected to resume construction in December.
Of the projects where work was started and subsequently halted citywide, 67% are residential (232 total sites). Within the residential category, 115 were identified as multifamily apartments. Another 23 sites are mixed-use projects that contain residential components.
The Building Congress also found that 43% of the stalled sites citywide remain vacant, meaning that developers have obtained land and construction permits but have yet to commence work.
Of the 610 projects on the DOB list, more than half have been on hiatus for at least three years (166 sites joined the list in 2009 and another 143 were added in 2010). A total of 88 construction projects have been added to the list in 2013.
With an eye toward even greater improvement of these numbers, Anderson says he's hopeful about Mayor-elect Bill de Blasio's new proposal to boost the city's tax on vacant sites. “It may be helpful.”
Meanwhile, Anderson offered some advice to the incoming mayor. "Mayor-elect Bill de Blasio has vowed that housing will be a priority for his administration. This list of stalled sites might be the perfect place to begin. These sites offer the potential to increase the city's housing stock, revitalize neighborhoods, create good jobs and grow New York's economy."
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
