City building boom has peaked: Report

Projected residential construction in New York City 1995-2010. Click image for more graphs.

Projected residential construction in New York City 1995-2010. Click image for more graphs.

A report published yesterday by the New York Building Congress predicted that the building boom New York City has experienced in recent years is peaking and will decline sharply in the near future.

The report states that while the construction industry has proven resilient, continuing to report record breaking numbers despite a national economic downturn, it will not be immune from the increasingly severe credit crisis and economic uncertainty plaguing the country in the years to come.

How could affect projects like Willets Point (if approved) remains uncertain. The city maintains that, despite rising construction costs, that its list of interested developers have the economic wherewithal to make its vision a reality, which comes with an estimated price tag of between $3 and $4 billion.

Regardless, the city will have to confront the economic viability of the project when it pitches its plan to the City Council Friday. Those in opposition of the project believe the economic recession the United States is mired in could torpedo the plan entirely.

“How are they going to justify paying all this money for this project when they’re cutting money from the budgets of teachers and police officers,” Jake Bono, co-owner of Bono Sawdust and Supply Co. in Willets Point, said in a recent interview. ” How do you justify that? They’re not going to be able to do it.”

Rising construction costs have already temporarily derailed one project in Queens, the redevelopment of Municipal Lot 1 in Flushing, located just a mile away from Willets Point.

Deputy Mayor Robert Lieber said in an interview last month that he isn’t concerned about the project’s economic viability.

“This project fills a lot of needs and we think those needs will continue to be there. What’s important to remember here is that this won’t be built in six months, it will be built over eight to ten years,” Lieber said. “We think we’ve come up with a plan that can withstand the vagaries of the market.

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