NEW YORK, NY–Amid a growing chorus from most public officials about the need to address New York City’s housing supply crisis, the Real Estate Board of New York (REBNY) today released a new report to better understand the state of the multifamily development market and worsening pace of production. The Multifamily Foundation Plan Application Report reviews monthly applications for residential building foundations submitted by developers to the NYC Department of Buildings (DOB). This is a helpful indicator of housing production as it more specifically tracks projects that have advanced from the planning stage to the construction stage. The full report can be downloaded here.
The new report supplements REBNY’s long-standing Construction Pipeline Report, which tracks new building job filings for all new projects (office, retail, hospitality and multifamily). These job filings typically occur well before any substantive development work has started and many additional steps such as financing, plan review and amendments will still need to occur. By providing additional perspective on how many multifamily projects have filed foundation applications, the new report provides a more substantial projection for housing production.
According to REBNY’s new report, foundation filings rose steadily in the first portion of 2022 before precipitously declining in the summer following the expiration of 421-a. There was a clear run-up in foundation filings prior to the June deadline (with 411 filings), followed by only 165 such filings since – a 59% decrease. While filings rebounded in the fall, the number remain below historic norms with some of this increase likely because developers sought to file projects in advance of the updated version of the NYC Construction Code going into effect on November 7.
The number of new housing units in projects seeking foundation approvals dropped significantly in the second half of the year. From January to November 2022 the number of proposed dwelling units in foundation filings totaled 43,708 units. Of these, 71.4% (31,412 units) were filed in the first five months of the year prior to the expiration of 421-a, compared to just 12,496 between June and November.
The first monthly Foundation Permit Report comes at a challenging time in the context of New York City’s worsening housing supply crisis. REBNY’s Q3 2022 Construction Pipeline Report showed a 68% quarterly decline in new application filings for multi-family housing. With 560,000 new housing units needed by 2030, this report sheds further light on the significant housing supply challenges facing New York City.
“New York City’s housing supply crisis has gone from bad to worse,” said REBNY Senior Vice President of Policy Zachary Steinberg. “There’s no light at the end of this tunnel unless the public sector works quickly to advance policies to facilitate the new housing and below market rate housing production that New Yorkers desperately need.”
The report released today includes additional analysis on foundation applications broken out by building size and geography. REBNY will continue monitor foundation filings to provide a better understanding of development activity.
For more information about REBNY research reports, visit go.rebny.com/Reports.
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ABOUT THE REAL ESTATE BOARD OF NEW YORK
The Real Estate Board of New York (REBNY) is the City’s leading real estate trade association. Founded in 1896, REBNY represents commercial, residential, and institutional property owners, builders, managers, investors, brokers, and salespeople; banks, financial service companies, utilities, attorneys, architects, and contractors; corporations, co-partnerships, and individuals professionally interested in New York City real estate. REBNY conducts research on various civic matters including tax policy, city planning and zoning, rental conditions, land use policy, building codes, and other city, state, and federal legislation. REBNY regularly publishes market data, policy reports, and broker surveys. In addition, REBNY provides for its members: informational, technical, and technological resources; networking and charitable service opportunities; qualifying and continuing education courses; professional education programs, seminars, and designations; career-changing awards; legal advice; and a wide range of additional member benefits. For more information, please visit www.rebny.com.