The residential market has experienced a precipitous decline after an unprecedented boom period. After five consecutive years in which residential construction exceeded 30,000 new dwelling units, the Building Congress projects construction of just under 6,300 units with a total construction value of $3.5 billion in 2009. The forecast calls for 7,900 units ($4.0 billion) to be produced in 2010 and 9,900 units ($5.0 billion) in 2011. These 24,000 units constructed between 2009 and 2011 will fall 10,000 units short of what was constructed in 2008 alone.According to the New York Times, the market for commercial space is even worse than the NYBC suggests--which, unmentioned, makes the short-term prospects for Building 1, the commercial tower planned for the Atlantic Yards project, not-so-likely, as even the Empire State Development Corporation acknowledged in June:
“They’re way too exuberant,” the developer Douglas Durst said of the report. Commercial vacancy rates are continuing to rise, he said, and rents are falling.What about AY?
GlobeSt.com reports on the NYBC's breakfast:
Then, onto Brooklyn and another case of stalling at the lawsuit-laden Atlantic Yards standoff. In response to a question from GlobeSt.com, [New York City Economic Development Corporation President Seth] Pinsky said, "another lawsuit is easy to file, but less easy to win." He says his agency is working very hard with the developers and the state to get the project’s details in order.DDDB says Pinsky should have a Plan B.
"We remain hopeful they’ll be able to make it to the financing market before the end of the year, but, this is a tricky project," he told GlobeSt.com Wednesday. "And, until everything is in place, you don’t know that it will be in place, but we remain optimistic and we hope the project will in fact move forward."
When pressed with what happens if the lawsuits do work, and there is a successful delay of the project’s successful trip to the financing markets, Pinsky stood pat, saying "we think this project is going to move forward, and that’s what we’re planning for."
And what about the housing market? Presumably a decline in new construction makes it easier for the projected Atlantic Yards housing units to be absorbed, as the KPMG market study for the Empire State Development Corporation suggests. Then again, that study is not very reliable.