NEW YORK, NY - A ranking of the top U.S. metropolitan areas by the dollar amount of new commercial and multifamily construction starts reveals the New York City metropolitan area leading the nation during the first half of 2015, according to Dodge Data & Analytics. A total of $17.3 billion of commercial and multifamily projects in the New York City metropolitan area reached groundbreaking during this year's January-June period, up 72% from a year ago.
The New York City amount was substantially greater than what was reported by the metropolitan area ranked number two, Miami FL, at $3.0 billion and up 38% from a year ago. Rounding out the top five metropolitan areas with their percentage change from a year ago were the following – Washington DC, $2.4 billion (down 15%); Boston MA, $2.2 billion (up 21%); and Seattle WA, $2.1 billion (up 49%). Metropolitan areas ranked 6 through 10 performed as follows during the first half of 2015 – Los Angeles CA, $2.0 billion (down 30%); Houston TX, $1.9 billion (down 36%), Denver CO, $1.8 billion (up 56%); Dallas-Ft. Worth TX, $1.8 billion (up 5%), and Chicago IL, $1.7 billion (up 7%). For the U.S. as a whole, commercial and multifamily construction starts during the first half of 2015 were reported at $73.2 billion, up 13% from a year ago. (The commercial and multifamily total is comprised of these project types – stores, warehouses, office buildings, hotels, garages and service stations, and multifamily housing.)
"Market fundamentals such as occupancies and rents continue to show improvement, which supports further growth for commercial and multifamily construction," stated Robert A. Murray, chief economist for Dodge Data & Analytics. "While the expansion for the overall economy remains tepid, as shown by the 2.3% growth for GDP in the second quarter, commercial and multifamily development continues to be a prime focus of the investment community in its search for yield. The level of construction starts for commercial building is still well below the peak volume of the previous decade, even with double-digit gains over the past four years. Multifamily housing has shown steady growth since 2010, which has generated some concern about overbuilding, particularly in the New York City metropolitan area. Still, New York City is seeing an even greater amount of multifamily construction starts this year, and the national multifamily upturn is now broadening in terms of geography, with construction gains taking place in more metropolitan areas."
The New York City metropolitan area during the first half of 2015 showed growth for both its commercial building (up 84%) and its multifamily (up 67%) segments from a year ago. Large commercial building projects that reached groundbreaking during the first half of 2015 included two structures at the Hudson Yards development on Manhattan's West Side – the $1.2 billion 30 Hudson Yards office/retail tower and the $400 million 55 Hudson Yards office tower. Other large commercial building projects that reached groundbreaking included the $575 million 1 Manhattan West project, the $200 million South Street Seaport Pier 17 retail center, and a $150 million tenant install at 10 Hudson Yards. As for multifamily housing, there were 24 multifamily projects valued at $100 million or greater that reached groundbreaking in the New York City metropolitan area during the first half of 2015, led by the $600 million 1800 Park Avenue apartment building, the $500 million 109 W. 57th St. apartment building, and the $500 million addition to Flushing Commons (phase 1) in Queens.