- REAL ESTATE EDUCATION
- GIVING BACK
$15.4B in real estate taxes enough to foot bill for vital services
March 6, 2014
By Steven Spinola
There’s a lot more to New York City’s real estate industry than meets the eye.
New York City’s real estate industry is not only a major economic engine — it also provides the tax base the City needs to fund the salaries of every single school teacher, police officer, fire fighter and a lot more city services.
These vital city services depend on the real estate industry for funding and are part of what make New York a great place to live, work, and raise a family.
REBNY’s new comprehensive economic impact study titled, “The Invisible Engine: The Economic Impact of New York City’s Real Estate Industry,” completed by AKRF, Inc, makes it clear that we must continue to build revenue-generating properties throughout the five boroughs and keep the ‘Invisible Engine’ running.
The study reveals that over the course of 2012, revenue-generating properties provided enough tax revenue to pay the City’s entire share of $13.1 billion in payroll expenses for teachers, police officers, fire fighters, sanitation workers and correction officers and still have $2.3 billion left to fund other city services.
These numbers factor in taxes from properties such as office and residential rental buildings, hotels, retail stores and utility properties and do not include one- and two-family homes, cooperatives, condominiums, schools, hospitals and other publicly-funded structures.
Excluding property taxes, the real estate industry generated $1.6 billion in additional tax revenue for the city in 2012, including nearly $700 million from the construction industry and approximately $920 million from non-construction services such as real estate agents and brokers, property managers, real estate appraisers, property and title insurance and others.
As one of the major job generators in the city, the real estate industry supported nearly 519,000 jobs — which represented 11 percent of the jobs in the City and $33 billion in annual wages.
Non-construction real estate activities supported 322,700 jobs, or seven percent of the city’s total, with an average wage of $51,780 in 2012. The construction industry supported 196,200 jobs with an average salary of $79,175.
The report demonstrates the enormous contribution of the real estate industry to the city’s economy and to the city budget.
New York City’s real estate industry generated $15.4 billion in taxes in 2012, which represents 38 percent of the city’s tax revenue, according to.
In sum, the total economic impact of the real estate industry’s activities was an enormous $106.2 billion in jobs, wages and output— including approximately 13 percent of the Gross City Product.
Clearly, the real estate sector plays a vital role in the life of our city and as a fundamental revenue source for the city government.
If you would like learn more about this economic impact study, visit rebny.com.
In other REBNY News:
The next Commercial “Crossfire” event will be on Tuesday, March 18, at 570 Lexington Avenue from 5:30pm-7:00pm. Entitled “The Art of Making a Restaurant Deal in NYC”, the panel will feature: Mark Birnbaum – Cacth, La Cenita, Lexington Brass; John DeLucie – The Lion, Crown, Bill’s; Stephen Starr – Buddakan, Morimoto, Caffe Storico; Michael Weinstein – Bryant Park Grill, Clyde Frazier’s, El Rio Grande; and Ed Hogan – National Director of Retail Leasing, Brookfield Office Properties. Joanne Podell, Vice Chairman of Cushman & Wakefield, and Jeffrey Roseman, Executive Vice President at Newmark Grubb Knight Frank Retail, will moderate. For more information, contact Desiree Jones at firstname.lastname@example.org.