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2022 - 2024 New York City Construction Outlook

Incredible growth forecasted ahead

The New York Building Congress forecasts $86 billion in New York City construction spending in 2022. This represents development growing $38 billion in inflation-adjusted dollars.

The New York Building Congress (NYBC) in collaboration with the New York Building Foundation presented their 2022 - 2024 New York City Construction Outlook during the annual Construction Industry Breakfast on October 19, 2022, which was attended by over 400 hundred AEC professionals.

This year’s Construction Outlook shows New York City’s building industry enjoying a roaring recovery as it bounces back from the devastation caused by the COVID-19 pandemic. Against all odds, construction spending and building levels over the next three years are projected to be relentlessly bullish in the face of economic headwinds and seismic changes in the city’s workforce patterns.

According to the Outlook “more growth and advancement are expected following Washington’s historic Infrastructure Investment and Jobs Act (IIJA) of 2021.” The NYBC urges the federal government to move quickly and efficiently to get these funds out the door and in the hands of our industry leaders, who will mold and shape the built environment of New York for future generations.

This year’s report presents “spending figures adjusted for inflation in a side-by-side comparison with that of nominal dollars (non-inflation adjusted dollars). Also, while some of the increased spending in 2022-2024 represents cost increases in construction, much of it is attributed to counterbalancing depressed construction activity in 2020-2021.”

Factors like “the lack of a suitable replacement for 421-a could dramatically dampen this outlook, while potential benefits from signature actions like the bipartisan IIJA, could infuse additional spending. Thus, this forecast should be continuously monitored.”



The New York Building Congress forecasts $86 billion in New York City construction spending in 2022. This represents development growing $38 billion in inflation-adjusted dollars. Even when compared to pre-COVID levels, spending is still dramatically increased, up by $13.7 billion from 2019, a 19 percent increase, in inflation-adjusted dollars. Fueling this rise, labor and material prices have escalated while shortfalls in development during COVID years are being addressed.

Spending in nominal dollars is expected to reach $270 billion ($250 billion, when adjusted for inflation) over a three- year period, growing to $87 billion in 2023 and then to $96 billion in 2024. Compared to the pre-COVID, three- year period from 2017 to 2019, this reflects an inflation-adjusted increase of $37.8 billion.


Although construction employment in 2022 is still behind its pre-COVID levels, the building industry is set to create tens of thousands of new jobs within three years. The Building Congress anticipates employment in the construction of buildings, heavy and civil engineering, and specialty trades to total 139,000 jobs in 2022, 143,000 in 2023 and 142,500 in 2024. With the dramatic rise in construction costs, construction jobs per $1 million in spending have dropped from 3.1 in 2021 to 1.6 in 2022 and 2023.




Compared to the pre-COVID three-year period 2017- 2019, forecasted residential spending for 2022-2024 will be up almost 70 percent in nominal dollars to almost $93 billion. Residential investment in new development, rehabilitation, and interior renovation has accounted for 23% of the increase in construction spending between 2019 and 2022. The average outlay per gross square foot of new housing has exceeded $400 in 2022, suggesting high levels of renovation investment. Going forward to 2024, development is expected to exceed 30,000 new units per year while the cost per square foot of residential spending may decline somewhat as less interior renovation occurs. By 2024, aggregate residential investment is forecast to reach $32.5 billion, up from $31.8 billion in 2022.


Non-residential spending, which includes office space, retail, hotels, institutional development, entertainment venues, and recreational facilities, is expected to reach $106 billion in nominal spending between 2022 and 2024. This represents a 57% increase from pre-COVID years 2017 to 2019. The share of spending in this sector is projected to increase to 39% of all construction spending in 2022, up from 34% in 2021.

New construction in large offices and healthcare facilities contributed to much of the increased share of non-residential construction. Manhattan saw more than a dozen completions of office buildings in 2019 totaling 10 million gross square feet of space. Subsequently, the past two COVID-affected years also delivered 11 new and converted buildings exceeding 4 million GSF of office floorspace. Looking forward, three mega towers with nearly 6 million GSF are scheduled for completion in 2022, while five equally large skyscrapers are destined to deliver 10 million square feet of office space over the 2023-24 period. Beyond this forecast period, several more major office buildings are on the horizon, generating current construction spending in their earlier years of development.

In contrast, other commercial developments — like retail, social or hotel facilities — have waned, while COVID has contributed to a significant demand

for heavy investment in educational and health care facilities, as well as in less costly warehouse or storage facilities. With shifting demands— as well as cost inflation and foregone maintenance and/or development — given current trends, the sum of all nonresidential construction investment is expected to peak above $33.7 billion in 2022 by year’s end.


Government spending under current conditions is expected to increase to almost $21 billion in 2022, $23.6 billion in 2023 and $26.9 billion in 2024.

During the COVID period, government investment in construction and development exceeded one-third of total construction investment in New York City — a high proportion given the prior five years, but significant only in that government’s spending did not decline as rapidly as private construction investment.

In 2022, construction spending by the public sector is expected to rise to $20.8 billion, more than 30% above the average annual spending level of the 2020- 21 period. As a consequence, government’s share of overall construction investment will begin to climb, reaching 28% of the total by 2024. While significant, given potential benefits of the IIJA, the volume of public spending on construction and development could conceivably reach higher shares in New York, in keeping with historic 40% averages.

Over the next two years, government spending on infrastructure development is projected to dominate the construction market. Much is yet unknown about the benefits of the IIJA. However, according to the capital plans of New York City, the Metropolitan Transportation Authority, and the Port Authority, $50.5 billion will be expended in 2023-24.

Please note that the agency detailed information below is based on publicly available capital budget information and may change as agency priorities shift.


In Fiscal Year 2022, New York City expended $8.25 billion on construction and design in 72 categories of municipal infrastructure. Chief among these was Education, at $5.6 billion, Housing Preservation & Development at $1.7 billion and Water Pollution Control, at $1.3 billion. The City’s Capital Budget for 2022 to 2025 calls for continued emphasis on these three capital improvement needs over the next two years, with the addition of Corrections and Highway Bridges. In the aggregate, however, municipal capital investment is planned to decline in nominal dollars without the infusion of federal or state infrastructure spending.


Within the five boroughs, the MTA is likely to invest a steady $34.8 billion in nominal dollars over the next three years, which would be a 70 percent increase over total spending between 2017 and 2019. Actual expenditures will depend on the agency’s execution of its current and past capital plans, the most recent of which expires in 2024. Construction and design commitments in the MTA’s 2020-24 capital budget with respect to facilities and equipment in New York City reflect a rising level of investment from $8.5 billion in 2022 to $14.2 billion in 2024. Projects most enhanced by additional funding include NYC Transit station work and accessibility improvements, as well as signal modernization, line structure rehabilitation, and the Second Ave Subway extension.


PANYNJ is expected to invest almost $2 billion this year in New York City capital projects, a $1.5 billion drop from 2021. Spending levels in the next three-year period are on par with those seen in the previous three-year period, each hovering around $5.5 billion. Capital budget expenditures of the PANYNJ were originally expected to decline in New York City over the next two years however, New Terminal One at JFK Airport, which is set to open in 2026 at a total cost of $18 Billion ($9.5 Billion privately financed), is expected to change this equation over the next two years. Among the other large recipients of capital spending in the 2022-24 period will be improvements to the Goethals Bridge and the Lincoln Tunnel. The City’s two bus stations are not anticipated to be a focus of investment in this period.


The remaining $1.5 billion in 2022 public works spending will be undertaken by agencies at the state and federal levels.


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