New York City apartment builders are putting their money where the future is — and that’s Brooklyn and the Bronx according to the latest review of building permits issued last year.
A New York Building Congress analysis of U.S. Census data found that the New York City Department of Buildings (DOB) issued residential permits for 10,599 units in 1,011 buildings in 2012, a 19 percent increase (in units) from 2011 when 8,936 units were authorized in 997 buildings. The number of residential permits issued has increased 75 percent since 2009 when it hit a post-recession low of 6,057 units.
Brooklyn and the Bronx have seen the biggest resurgence, with the number of residential units authorized more than doubling there last year, according to the NYBC.
Brooklyn was first among the five boroughs with 3,353 units permitted (up from 1,522 units in 2011) followed by The Bronx with 2,552 units (up from 1,116 a year ago).
Queens, moved in the opposite direction. Residential permits fell from 3,182 in 2011 to 1,529 in 2012. As a result, Queens dropped to fourth of the five boroughs in 2012, after topping the list in 2010 and 2011.
Manhattan residential permits remained stable, going from 2,535 in 2011 to 2,492 in 2012. In 2010, just 903 units were permitted in Manhattan. Staten Island experienced a modest increase, from 581 units in 2011 to 673 in 2012.
Of the 10,599 housing units authorized in 2012, 86 percent are to be located in buildings that will house five or more families.
Two family buildings accounted for 6 percent of authorized units followed by 3-4 family buildings (5 percent) and single family homes (3 percent).
“In applying for new permits, the City’s residential developers are expressing renewed confidence in the City’s future, as are the banks that have once again started providing construction financing,” said Richard Anderson, president of the Building Congress.
“These positive indicators demonstrate that the residential sector will be a strong and growing source of spending and construction employment throughout the five boroughs.”
Despite the recent resurgence, residential permits remain far below the levels attained between 2005 and 2008, a four year period in which the DOB issued permits for more than 30,000 units.
At its 2008 peak, the DOB issued permits for 33,911 units in 2,434 buildings.
But residential construction activity is on the upswing with further growth anticipated in the coming years.
In its most recent construction forecast, released in October 2012, the Building Congress estimated that 10,000 residential units would be produced in 2012, followed by 12,500 units in 2013 and 15,000 units in 2014.
“The residential market is steadily climbing back from the doldrums of 2009 and 2010,” said Anderson.
“While we are likely to remain well below the peak attained in the middle of the previous decade, the latest data is encouraging nonetheless. ”
The estimated cost of construction per unit reached $98,000 in 2012, an increase of less than $1,000 per unit from 2011. Both Staten Island ($133,000) and Queens ($105,000) topped $100,000 per unit, while the cost per unit in Manhattan, Brooklyn and the Bronx fell within a range of $93,000 to $95,000.
The discrepancy in per-unit costs is a result of Staten Island and Queens being home to more one- and two-family construction projects, which are more expensive to build than multi-family housing.