The city greenlit less than 2,000 new residential units in the first quarter, a far cry from the nearly 6,500 units approved during the same period last year. That’s according to a new analysis of Department of Buildings records by TRData.
In terms of space, the drop in new construction activity is just as stark. Permits for a total of 2.5 million square feet of space in residential projects were approved in the first quarter, less than half of the 6.65 million square feet of space approved during the same period last year. The low totals likely represent the dearth of new applications filed since the expiration of the 421a tax abatement.
Last year, the second quarter saw the most activity, with a whopping 36,367 units approved for a total of 43.4 million square feet of space, TRData show. At the time, developers and the city scrambled to get their ducks in a row before the abatement was set to expire June 15 (Following the expiration, developers and unions tried to resuscitate the abatement, but talks collapsed in January of this year.)
| Quarterly View of Permits Issued | ||
|---|---|---|
| Q1 2015 - Q1 2016 | ||
| Period | Residential Units | Total Square Footage |
| Q1 2015 | 6,466 | 8,344,309 |
| Q2 2015 | 36,367 | 43,393,979 |
| Q3 2015 | 3,829 | 6,653,160 |
| Q4 2015 | 9,454 | 11,229,603 |
| Q1 2016 | 1,982 | 2,502,952 |
| Source: TRD analysis of Department of Buildings permit data | ||
The drop in activity in the first quarter may also reflect changes in the city’s processing speed, or changes over time in the proportion of applications that are ultimately approved and issued as permits.
Developers and groups that represent them, such as the Real Estate Board of New York, have warned that without 421a or a similar tax incentive, it will no longer be feasible to build mixed-income rental housing in New York. A handful of groups are wrestling with alternatives.