Fresh of Hurricane Harvey, days away from Irma and five years after New York was battered by its own Hurricane Sandy, the real estate community is more resilient and prepared for a severe weather event.
Many developers and architects were forced to re-think design plans after Hurricane Sandy flooded waterfront areas, leading to the remapping of floodplains.
In South Williamsburg, developer Two Trees Management re-drew plans for the mixed-use Domino Sugar Factory project, which includes residential units, retail, office space, and a waterfront park.
In Lower Manhattan, among the hardest hit areas of NYC, 39 percent of commercial buildings in were affected by Hurricane Sandy, and approximately 320 retailers were closed for over a week after the storm, according to the Downtown Alliance. After many buildings sustained severe flooding, infrastructure was retooled for future resiliency.
Now, nearly five years later, the area is thriving, according to a recent Downtown Alliance report. And property owners have put millions of dollars into securing their buildings and preparing for future storms.
“Property owners have made substantial investments in buildings to protect them from another serious weather event,” said Josh Nachowitz, vice president of research and economic development at the Downtown Alliance.
Those investments include relocating infrastructure and building systems within their properties, installing floodgates and flood walls, and thorough disaster planning.
Utility providers Verizon and ConEdison have done a lot of work in Lower Manhattan since Sandy on hardening utility networks, making them more resilient in the face of a severe storm.
This includes Verizon transitioning from copper wiring to fiber optics, which are more resilient to saltwater, and ConEdison installing more resilient infrastructure.
“I think major property owners are much more prepared today than they were five years ago,” said Nachowitz.
However, the need for substantial infrastructure upgrades to protect the city still exists. One project the de Blasio administration has been working on is the East Side Coastal Resiliency Project. That project has undergone extensive planning over the last year, and would serve to protect the waterfront from 23rd Street down to the Lower East Side.
“I think essentially we’re seeing that cities and practitioners and development professionals are recognizing that these types of storm events are increasingly frequent and it just makes sense to be prepared from a business perspective,” said Katharine Burgess, senior director of urban resilience at the Urban Land Institute (ULI).
“I think we are seeing increased interest in resilience, and largely that is because it just makes good business sense to be prepared. Investing in resilience can lead to cost efficiency and lead to opportunities to increased real estate value.”
In a report that studied how investing in resiliency correlates to return on investment, ULI found that the Arverne by The Sea development in Rockaway, Queens, sustained only minor damage after Hurricane Sandy, unlike most of the neighboring areas.
The 120-acre master-planned and mixed-use community in Rockaway Beach was left intact and recovered quickly because of the resiliency measure that were included in its planning, design, and construction.
As a public/private partnership, the developers of Arverne by the Sea were required to purchase the land from the city and build new public infrastructure, but they invested more than required in both infrastructure and other elements that provided resiliency—an estimated $100 million, or 10 percent to 15 percent of the overall project development cost, according to the report.
The fiber-cement siding, for example, cost 20 percent to 25 percent more than typical vinyl siding. The developers believed that the investments in durable, high-quality construction helped the project withstand damage from Sandy, enhanced the community’s reputation, and have led to higher-than-market rental and for-sale prices.
AccuWeather president and chairman Dr Joel Myers has predicted that Hurricane Harvey will be the most costly natural disaster in United States history after it wreaked havoc in Texas last week.
Sometimes called the “father of commercial meteorology,ˮ Myers stated, “This is the costliest and worst natural disaster in American history. AccuWeather has raised its estimate of the impact to the nation’s gross national produce, or GDP, to $190 billion or a full one percent, which exceeds totals of economic impact of Katrina and Sandy combined. The GDP is $19 trillion currently. Business leaders and the Federal Reserve, major banks, insurance companies, etc. should begin to factor in the negative impact this catastrophe will have on business, corporate earnings and employment.
“Parts of Houston, the United States’ fourth largest city will be uninhabitable for weeks and possibly months due to water damage, mold, disease-ridden water and all that will follow this 1,000-year flood.”
Due to the negative impact to the national economy, Myers predicted the Federal Reserve will postpone the next increase in interest rates.