After sticking to its guns about using a Kips Bay site only for life science and education and not housing, New York City has picked a winner for its lucrative construction contract.
The city’s Economic Development Corporation tapped Skanska to oversee the construction of the first phase of SPARC Kips Bay, the nonprofit announced on Friday. The contract award is expected to approach $1 billion.
Construction of the project’s first phase is expected to commence by the end of next year. Completion isn’t anticipated until 2031.
The campus will be between First Avenue and the FDR Drive and East 25th and East 26th streets. The project’s first phase will include more than 600,000 square feet of educational facilities for the City University of New York and New York City Public Schools, as well as a public open space.
Phase two will feature more life science space, a Bellevue/NYC Health + Hospitals outpatient care and advanced nursing practice simulation training center, and laboratory space for the Office of Chief Medical Examiner.
The project will also include flood protection measures and a rebuilt East 25th Street pedestrian bridge over the FDR. The contract carries a 30 percent participation goal for minority and/or women-owned business enterprises, as well as a 6 percent goal for certified service-disabled veteran-owned businesses.
Officials hope the project will generate $42 billion in economic benefits over a 30-year period. The development is expected to result in nearly 2 million square feet of life science and education space, as well as 3,100 permanent jobs.
Life science space is expensive to build and often requires government assistance, as has been the case with the East Side campus. A CBRE report from February noted that the life science market faced “significant headwinds” in New York and nationally, in part because of high interest rates. A new JLL report says, “While industry challenges persist in the short term, signs continue to point toward long-term growth for life sciences in the U.S. and across the globe.”
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