Residential Sector Continues to Drive Bronx Building Boom

John Jordan | December 28, 2017

The proposed Bronx Point project in the South Bronx, which will include up to 1.045 housing units and a hip-hop museum, was approved by the New York City Council in October and will be led by L+M Development Partners of Larchmont and Type A Projects of New York City.

NEW YORK CITY—New construction starts in the Bronx are expected to surpass the $2-billion plateau in 2017, according to a report released today by the New York Building Congress.

While several new large public works projects came on line this year, the residential housing sector in the borough accounted for more than 50% of the construction starts so far in 2017, according to the report.

The report—“Construction Outlook Update: Bronx Construction Starts”— notes that for the first nine months of this year, the Bronx represented 5% of the total value of construction starts for New York City. This is a slight decrease from the 7% experienced in 2016. In 2015, the Bronx accounted for 5% and in 2014 it represented 4% of all city new construction starts. The report is based on construction start data provided by Dodge Data & Analytics.

“The Bronx is experiencing positive momentum and benefitting from continued strong investment from both the public and private sectors,” said Building Congress President and CEO Carlo A. Scissura. “With the value of annual construction starts more than doubling since the beginning of this decade, it’s obvious that the development community now views the Bronx in a whole new light. And I would be surprised if that percentage doesn’t continue to rise in the coming years.”

The top two Bronx project starts by value in the first nine months of 2017 involved public works. The list was headed by a $232-million New York State Department of Transportation-funded project to replace Unionport Bridge, which carries the Bruckner Expressway across Westchester Creek. The second project is a new 12-story, 305-unit, mixed-use project valued at $133 million, which is being developed by the City’s Housing Preservation & Development in partnership with the Women’s Housing and Economic Development Corp. and BFC Partners.

Over the past three years, nine of the top projects in the Bronx have come from the public sector, including the Bruckner Expressway project and a $213-million reconstruction project of the toll plaza on the Bronx side of the RFK Bridge in 2015.

Renovations and alterations to PS 46, PS 14 and PS 19 were the largest of the institutional projects, so far this year with each project topping $50 million in value.

The residential sector has led the way in the Bronx, representing 52% of the value of all construction projects initiated in the borough between 2015 and the first three quarters of 2017. Major projects include a $104 million, 256-unit, mixed-use project in East Tremont and a $100 million, 314-unit, mixed-use project in the Belmont section of the Bronx.

Over the same period, the institutional sector accounted for 19% followed by public works with 17% and commercial buildings with 9% market share. The remaining 3% was made up of various utilities and manufacturing projects.

The residential sector continues to drive the Bronx construction market through the first three quarters of 2017, accounting for 53% of the value of all construction projects in the borough, followed by public works (20%), institutions (15%) and commercial properties (11%).

Through the first nine months of 2017, 3,190 residential units were initiated in the Bronx. This puts the borough on pace to narrowly surpass 2015’s total of 4,240 units, which was the current high point of this decade, according to the New York Building Congress.

“The Bronx possesses the most opportunities for new residential development, and the ability to produce new housing for residents at all income levels,” said the Building Congress’ Scissura. “As the de Blasio administration further ramps up its affordable housing program and as private developers increasingly look to the north, the future looks bright for the Bronx.”

The Bronx’s nine-month total represents about 17% of the housing units started throughout the city in 2017, which is in keeping with 2016, when 3,918 of the 23,694 housing units emanated from the Bronx. These 2016 and 2017 Bronx totals are an improvement from the period between 2011 and 2015, when the percentage of units initiated in the Bronx ranged from 8% to 11%.

In the first three quarters of 2017, the Bronx saw the construction of 1,515 units of affordable housing initiated, while 1,150 units were rehabbed during the same nine-month period.



John Jordan
Editor, Real Estate In-Depth