[The Agonist]

This obviously applies all over the country and much of the world, but it is on such a bigger scale in NY. We all knew this but it is good to see some real data and sources. The worst is yet to come, so it will be another 5-10 years before another boom can start.

http://www.nytimes.com/2008/12/27/nyregion/27developers.html?_r=1&hp

Downturn Ends Building Boom in New York
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By CHRISTINE HAUGHNEY
Published: December 26, 2008
Nearly $5 billion in development projects in New York City have been delayed or canceled because of the economic crisis, an extraordinary body blow to an industry that last year provided 130,000 unionized jobs, according to numbers tracked by a local trade group.

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Librado Romero/The New York Times
Charles Blaichman, at an unfinished tower at West 14th Street, is struggling to finance three proposed hotels by the High Line.
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Times Topics: Credit Crisis — The Essentials

The setbacks for development — perhaps the single greatest economic force in the city over the last two decades — are likely to mean, in the words of one researcher, that the landscape of New York will be virtually unchanged for two years.

“There’s no way to finance a project,” said the researcher, Stephen R. Blank of the Urban Land Institute, a nonprofit group.

Charles Blaichman is not about to argue with that assessment. Looking south from the eighth floor of a half-finished office tower on 14th Street on a recent day, Mr. Blaichman pointed to buildings he had developed in the meatpacking district. But when he turned north to the blocks along the High Line, once among the most sought-after areas for development, he surveyed a landscape of frustration: the planned sites of three luxury hotels, all stalled by recession.

Several indicators show that developers nationwide have also been affected by the tighter lending markets. The growth rate for construction and land development loans shrunk drastically this year — to 0.08 percent through September, compared with 11.3 percent for all of 2007 and 25.7 percent in 2006, according to data tracked by the Federal Deposit Insurance Corporation.

And developers who have loans are missing payments. The percentage of loans in default nationwide jumped to 7.3 percent through September 2008, compared with 1 percent in 2007, according to data tracked by Reis Inc., a New York-based real estate research company.

New York’s development world is rife with such stories as developers who have been busy for years are killing projects or scrambling to avoid default because of the credit crunch.

Mr. Blaichman, who has built two dozen projects in the past 20 years, is struggling to borrow money: $370 million for the three hotels, which include a venture with Jay-Z, the hip-hop mogul. A year ago, it would have seemed a reasonable amount for Mr. Blaichman. Not now.

“Even the banks who want to give us money can’t,” he said.

The long-term impact is potentially immense, experts said. Construction generated more than $30 billion in economic activity in New York last year, said Louis J. Coletti, the chief executive of the Building Trades Employers’ Association. The $5 billion in canceled or delayed projects tracked by Mr. Coletti’s association include all types of construction: luxury high-rise buildings, office renovations for major banks and new hospital wings. Mr. Coletti’s association, which represents 27 contractor groups, is talking to the trade unions about accepting wage cuts or freezes. So far there is no deal.

[tablemtn]

What is the status of that whole "Freedom Tower" mess?

[M II A II R II K]

Still set to rise out of the ground as far as I know, which means that the skyline would in fact change in the next 2 years unlike what the article states.

[babybackribs2314]

Yeah, let's talk about how NYC has more supertalls under construction/approved/proposed than currently exist (likely to be built or already being built buildings include the three WTC supertalls and the World Product Center while I'd say the Torre Verre and the other Hudson yards supertalls are also likely but less soo than the WTC/WPC to built). Or, how Beekman and other buildings are still soaring--NYC's boom is far from over, financial companies will just have less of a presence in the new buildings than before.

[david23]

This is an interesting article about total construction spending for the last few years: http://www.insurancejournal.com/news/east/2008/10/15/94653.htm

[JDRCRASH]

Wow, what a surprise?:rolleyes:

It shouldn't be; you guys had literally over a hundred high-rises 20 stories that were built or are currently U/C throughout the city the last 5 years. With big financial firms dying or weakening, along with the collapse of Wall Street, don't be surprised to see dozens and dozens of cancelled projects over the next few months.....

New Yorkers should be grateful that at least some stuff is getting built. In Los Angeles, nothing major has broken ground in well over a year.

IMO, the projects that don't yet have construction financing or loans in place are pretty much doomed, especially in NYC, where overbuilding has taken on a whole new meaning. I think we need to stop calling this the Credit Crunch, and start saying Credit "Crush", or "Obliteration", because the market has no longer slowed........its dead.

[Kingofthehill]

^ Yeah, it's really unfortunate that LA's recent wave of prosperity and growth came in at the tail-end of the boom.

:(

[JDRCRASH]

^
Because of NIMBY Homeowner interference.....

[The Agonist]

Yeah, let's talk about how NYC has more supertalls under construction/approved/proposed than currently exist (likely to be built or already being built buildings include the three WTC supertalls and the World Product Center while I'd say the Torre Verre and the other Hudson yards supertalls are also likely but less soo than the WTC/WPC to built). Or, how Beekman and other buildings are still soaring--NYC's boom is far from over, financial companies will just have less of a presence in the new buildings than before.


Please produce the list of Roof Top >1000 ft buildings pending/approved/proposed in NY that are greater in number than all those built in the world.

[babybackribs2314]

Please produce the list of Roof Top >1000 ft buildings pending/approved/proposed in NY that are greater in number than all those built in the world.

I meant that currently exist in the city... kind of obvious, but I guess some need clarification.

Also, NYC isn't overbuilt at all. Demand for new office space is extremely high, given most existing space is dated... NYC is much less vulnerable than other parts of the country to the credit crisis.

[The Agonist]

I meant that currently exist in the city... kind of obvious, but I guess some need clarification.

Also, NYC isn't overbuilt at all. Demand for new office space is extremely high, given most existing space is dated... NYC is much less vulnerable than other parts of the country to the credit crisis.

NYC only has a few true supertalls *roofs greater than 1000 ft". Given that Chicago has 4 (the same as NY including WTC), I think it is safe to assume the world has much more.

[emathias]

NYC only has a few true supertalls *roofs greater than 1000 ft". Given that Chicago has 4 (the same as NY including WTC), I think it is safe to assume the world has much more.

Dude, that was never in dispute, so what's your beef?

He never said a damn thing relating NYC to the world, he was only talking about NYC's current boom compared to NYC's pre-existing inventory.

If you somehow drew out of what he wrote a comparison to the world at large, you misunderstood what he wrote. I don't think anyone else here did misunderstand that, though, so accept your mistake and move on.

[JDRCRASH]

Please produce the list of Roof Top >1000 ft buildings pending/approved/proposed in NY that are greater in number than all those built in the world.

I think he's talking about NYC's existing supertalls with those that are U/C, Approved, or Proposed.

Also, NYC isn't overbuilt at all. Demand for new office space is extremely high, given most existing space is dated... NYC is much less vulnerable than other parts of the country to the credit crisis.

Absolutely not true...

Yeah, let's talk about how NYC has more supertalls under construction/approved/proposed than currently exist(likely to be built or already being built buildings include the three WTC supertalls and the World Product Center while I'd say the Torre Verre and the other Hudson yards supertalls are also likely but less soo than the WTC/WPC to built). Or, how Beekman and other buildings are still soaring--NYC's boom is far from over, financial companies will just have less of a presence in the new buildings than before.

Your right; around 5 that already exist, compared with 7 that are currently u/c or in planning or approval stages.

[MequonWI]

This is a great article but it's worth noting that this isn't just a New York City thing, or for that matter an American thing. New major residential and commercial construction around the world are going to find it almost impossible to get funding. Projects around the world are also going to have issues rolling their construction financing into permanent loans. We are going to see a massive wave of projects in foreclosure in the near future.

[NYguy]

This is old news in New York. All you had to do was look at the drop in building permits...

http://www.observer.com/2008/license-dive-city-building-permits-drop-40-percent

The number of new building permits issued in New York City this January and February was down about 40 percent compared to the same period last year, according to the city’s Department of Buildings.

Building permits, which augur future construction, are a strong indicator of how robust the real estate market is, and the drop-off indicates even New York’s strong market is feeling the effects of the subprime mortgage bust and the tremors it has sent through Wall Street.

The city issued 451 new-building permits in January and February, compared to 764 during those months last year and 859 during the period in 2006.


That being said, what is being built in the city is a lot more than some cities combined. And the city is currently undergoing possibly its greatest skyline transformation ever. From that point of view, the article is misleading. If you want an accurate picture of the "building boom" in New York, stick to the New York skyscraper threads.

[JDRCRASH]

^Dang....thats faster than I thought. Though I don't know if this current boom qualifies as the Big Apple's "Greatest Skyline Tranformation Ever." You have to admit, the 20's and early 30's were a prosperous time, too.

This is a great article but it's worth noting that this isn't just a New York City thing, or for that matter an American thing. New major residential and commercial construction around the world are going to find it almost impossible to get funding. Projects around the world are also going to have issues rolling their construction financing into permanent loans. We are going to see a massive wave of projects in foreclosure in the near future.

Which makes me wonder how soon-to-be-vacant projects in Dubai find the financing for themselves when they probably won't pay themselves off for years....

[Dac150]

In terms of office construction, what many don't understand is that the office projects on the West-Side such as Manhattan West, Hudson Yards, Hotel Penn, WPC, and the others, are being developed for future demand and need. Many people believe that the WTC is going hand in hand in accomplishing that when in reality it is simply just filling the void for what was lost. Those projects on the West-Side will, I believe, be the jumpstart for the boom when it strenghtens back up.

In regards to some of these residential towers that are getting the red light for a little while is a result of a lack of financing and is by no means uncommon.

The way I see is the Manhattan boom is by no means over, but just slowed down a bit until this economic mess works its way it. The reality is that the situation as of now will change and when it does the demand will return. The demand isn't gone but just currently frozen until better times come to be. This can be said for any city.

[PEORIA]

If it's ANY consolation to NYC fans, You're not suffering alone! Booming Dubai and Las Vegas aren't immune from the massive Global Recession that's halting and cancelling urban development projects in several continents. * See the following CBS News video and Newsweek article links (below)....


* http://www.precisenews.us/pt/video/tplayer.html?assetId=V3598625&feedId=f909&group=news&title=Downturn%20In%20Dubai&tags=dubai%20downturn%20worldwide%20economic%20crisis

http://www.newsweek.com/id/135638

" If misery loves company, misery has company enough. " - Henry David Thoreau

[ltsmotorsport]

So with all this doom and gloom, is 2 WTC still gonna get going or will it be left behind while its neighbors see all the construction glory?

[STERNyc]

Crawford?

http://forum.skyscraperpage.com/showthread.php?t=157034&page=4

[JDRCRASH]

^ Wow, what shortsightness. Everybody knows that NYC is gonna slow, but I don't think it's gonna fall into a BIG-TIME collapse like Miami and Las Vegas.

From what i've heard from the news, however, what the rest of the country experiences, is what NYC sees 1-3 years after.

[Crawford]

Crawford?

http://forum.skyscraperpage.com/showthread.php?t=157034&page=4

Uh, yes?

You finally admit you don't know what you are talking about? The article contradicts all your wacky claims.

[Dac150]

So with all this doom and gloom, is 2 WTC still gonna get going or will it be left behind while its neighbors see all the construction glory?

I'd pretty much consider the WTC as a whole a done deal. And again, as for the rest of the city there is some slowing down, but in comparison to other cities around the world, we're still doing pretty good.

[DaveofCali]

As JDRCrash said, many of you guys should be grateful that a lot of buildings were built in your cities. These building boom waves come and go, and your cities took advantage of them (especially Las Vegas, San Diego, and Miami). Los Angeles was largely unable to take advantage of the building boom, because it took such a long time to build momentum that when things were going to start to be built on a massive scale, the economy crashed. Building booms don't last, so you shouldn't expect them to, what matters is if your city took advantage of the building boom.

[STERNyc]

Uh, yes?

You finally admit you don't know what you are talking about? The article contradicts all your wacky claims.

Your disillusion. It confirms my earlier claims.

Your arrogance and utter lack of humility to admit when you're wrong is why I continue to bring it up.

Perhaps John McCain got his understanding of the economy from you.

Unfortunately aside from the new WTC NYC probably won't see another building over 1000 feet for about another decade, a statement I stand by.

Recent Victims:
Tower Verre (This one kills me)
Harlem Park
56 Leonard Street
50 West Street
Nobu Hotel

Many many more will officially be announced in the coming months...

The economy expands and contracts, it had not too long ago expanded in unprecedented continuous levels. When it contracts investments from equity both internal(less profits) and external(less investment) dry up, when it dries up all business related investments; PPE, hiring, expansions in general are curtailed. This is a basic understanding you should have learned when you went to business school a millenia ago. There is no financing for billion dollar projects right now, but even if there was although it goes hand-in-hand there are no companies to occupy them, companies are laying-off left and right to show investors a constant revenue stream and uninterupted payment of dividends, less employees, less space, not expanding effects office vacancy (up 43% in Manhattan from last year - PERE), hand-in-hand the residential luxury market has taken a huge hit (luxury sales down 30% in Manhattan from last year -NYTIMES) as well. When it contracts, it contracts. Its a painful reality, but until our economy expands again (inject your own forecast) you just wont see the construction of supertall buildings again.

I look at and understand numbers.

Believing Crawfords theory that the economy is still doing well and that all the proposed buildings will go forward is delusional-silly.

[Crawford]

Stern, basically everything in your post is a lie. I can go line by line if your prefer.

All of your alleged building "victims" are on hold, because of the credit crunch. They cannot be built without outside financing, which is temporarily frozen, a point that seems to elude your grasp. NOTHING can be built with outside financing until markets gain fluidity.

You have repeatedly proven yourself ignorant on anything having to do with construction and development, whether in NYC or elsewhere, and you have zero grasp of credit markets, developer financing and the construction cycle.

That said, nothing in your post has anything to do with your previous point, which was that 1. You were guaranteeing that there would be no more construction on earth for a full ten years, and 2. You were guaranteeing that no 1,000 foot buildings would be possible, especially in NYC. The fact that A. There is tons of constrcution throughout the world and B. There are ALREADY 1,000 foot buildings u/c in NYC, and more planned than at any time in history, contradict your thesis.

Nothing in the article comes remotely close to your "ten years of no construction" claim. Please reference ONE source that claims there will be a new paradigm with all construction on the planet halted for a full ten years...:koko:

[STERNyc]

That is an absolute lie^^^

Show me where I said that?

Ill write what I said in bold because I feel you must hard of seeing.

I originally said and have always said (the only thing I've ever said):

Other than the World Trade Center there will not be the construction of another building in NYC over 1000 feet for another decade.

I stand by that forecast.

[STERNyc]

There are ALREADY 1,000 foot buildings u/c in NYC, and more planned than at any time in history, contradict your thesis.


BOFA started construction way before the current economic crisis. I said the WTC will be built. All the other planned buildings were all planned during the boom, name one since. And planned means nothing, they won't be built if at all for another decade.

[JDRCRASH]

You were guaranteeing that there would be no more construction on earth for a full ten years,



Ever heard of a forumer named ladowntowner? Ever heard of a forumer named Edluva? (I'm pretty sure you've heard of him, actually)

Try to convince them that it will take less than that timetable, because they seem to have some pretty good points; one of them being that the next wave of ARM's are going to reset in the coming years, thus crushing prices even more.

I will say that 10 years is a long time, but 5 years seems about right.

[STERNyc]

You might be right. Forecasts are never wholly accurate, I made mine based on historical information about NYC building booms, usually there's about about a 10 year waning period between. I'd comfortably say atleast 5 years.

Another thing about the mortgages. Even though the government is backing most restructured mortgages, an estimated 33% of the modified loans will still default, we're no where near the bottom.

[Theoryg]

I think New York needs to stop building anyway. Its overbuilt by far and I used to get sick there from so much concrete. If I had my way I would deconstruct about 15 of its newer buildings atleast

Anybody see the place overbuilt like me??

[tdawg]

Here is a pretty good list of the only major projects in the city on hold due to the economy/credit crisis (from today's Post).

By LOIS WEISS

.

January 15, 2009

A MAJOR lack of financing and a real estate market in the doldrums has stalled many developments leaving work on them in various stages of completion.

MIDTOWN

The most valuable hold is the former Hotel Drake site at the northeast corner of Park Ave. and East 56th St. that includes some pieces on East 57th St.

Assembled by Macklowe Properties for more than $500 million over many years, the hotel itself was finally demolished. Now a senior note is being sold with the winner expected to complete foreclosure proceedings, complete the assemblage of the final pieces of the site, and proceed with the development.

Nearby is the former YMCA at 610 Lexington Ave. to be developed with air rights from the Seagram Building. Here, RFR Holdings has a Shangri-La Hotel and condos waiting in the wings. A predevelopment loan was with Lehman Bros and the rest of the financing is yet to be put in place. Foundation work is proceeding. I work across the street from the Shangri-La site, and I've noticed no slowdown. Work continues on the foundation.

Across from Carnegie Hall, Gary Barnett's Extell Development has a Park Hyatt waiting to fill the gap on West 57th Street. Again, a construction loan will be elusive even with a premier site that will have spectacular Central Park views.

EAST SIDE

On the East Side, a steam plant was taken down in preparation for the $4.4 billion multi-building East River Realty project to be developed by Sheldon Solow just south of the United Nations along First Avenue. Solow, who owns the land free and clear, paid moe than $630 million to buy the site from Con Edison, and has spent another $100 million on environmental cleanups and demolition. The community fought over what should be allowed, Solow's partners dropped out, and now he is in litigation with the State Department of Environmental Conservation over the availability of $250 million in cleanup money.

While hoping for a pact with the United Nations, Solow is so far without a major anchor tenant for any commercial building, and the city's residential market is not conducive to new construction.

HARLEM

In Harlem, the long awaited first office tower to be developed in more than 30 years is once again canceled. The 21-story, 600,000 foot Harlem Park tower was to be built at 125th St. and Park Ave. by Vornado Realty Trust. Vornado had taken over the site when the first, inexperienced developer couldn't get the project off the ground. That Vornado, a real estate investment trust which built the Bloomberg Tower at 731 Lexington Ave., can't get this out of the ground is a telling sign of the poor state of the real estate market. But it is also a reflection of the high costs of city construction leading to sky high office rents in an area that couldn't sustain them.

DOWNTOWN

Downtown, Time Equities has owned the site at 50 West St. for many years. CEO Francis Greenburger says he doesn't have to make a decision on moving forward with a 65-story hotel and residential tower designed by Helmut Jahn until later this year and can then decide to "landbank" it for a better time.

He already has some permits and some financing for the new building.

[Mr Roboto]

I think New York needs to stop building anyway. Its overbuilt by far and I used to get sick there from so much concrete. If I had my way I would deconstruct about 15 of its newer buildings atleast

Anybody see the place overbuilt like me??

Haha, no offense, but I think you might be on the wrong forum! NYC cant have enough buildings as far as Im concerned. I love the vast skyscraper density over there, to me its one of the reasons the place is so special. The more they add the better. Now if youre an architecture critic, you might have to be a little more specific about which buildings you'd like to decosntruct.

I hope any national slowdown only lasts a few years, but it seems even NYC is at least a little susceptible. I know we are feeling it here, and it sucks.

[KennyNYC]

So with all this doom and gloom, is 2 WTC still gonna get going or will it be left behind while its neighbors see all the construction glory?

There has been talks about building a retail podium of a few floors first and building the office skyscraper later on. It all depends on the economy. 7 WTC has been completed for how long now? And it's still very empty.

[alexjon]

"...but in San Francisco, where things are superior..." in 3...2...