Residential Activity Rises But Not Enough to Stop Non-Residential Dive
Construction starts in New York City dropped 16% in the first half this year, to $6.6 billion, compared with the same year-ago period, according to a recent New York Building Congress analysis of McGraw-Hill Construction Data. The non-residential sector took the hardest hit in the first six months, diving 48% to $3.2 billion, NYBC says. The data cover all project starts including new construction, alterations and renovations.
"The data from the non-residential sector, while disappointing, are understandable given the tepid pace of the city's and the nation's economic recovery," said Richard Anderson, NYBC president in a statement. "While there's no shortage of planned projects, especially in the office sector, we are lacking the type of job growth and confidence in the overall economy that is necessary to get these projects off the ground quickly."
However, the two biggest construction starts in the first half occurred in this sector, he says. These are Macy's Herald Square's $400-million renovation and the World Financial Center's Winter Garden's $250-million renovation. No. 19 on the overall project list, a 12-story building at 51 Astor Place in Manhattan, was the largest office construction start.
Starts in both the residential and non-building sectors grew in the first half. Anderson says the residential sector data are "very encouraging" with starts totaling $1.9 billion, up from $929 million in the first half of 2011 and well above 2010's $1.3 billion and 2009's $1.5 billion first-half totals. This sector reached $3.5 billion in the same period in 2008, however.
"If you go back to July of 2011, this sector has generated nearly $4 billion in new projects," Anderson says.
Non-building sector activity grew to $1.5 billion, up 66% from the same period last year. NYBC says this sector's biggest starts in the first half were a $242-million project to connect the West 60th St. area to the Third Water Tunnel, and a track and train signals project related to the ongoing construction of the Second Avenue Subway. The value of the latter project was not provided.