Public sector spending on new institutional construction in New York City outpaced private spending during a recent two-year period, according to a building industry report.
The New York Building Congress reported Monday that the city’s private and public institutions initiated $8.1 billion of construction projects from May 2008 through April 2010 with public sector projects totaling $4.87 billion, or 60%. Data for comparison of previous years’ spending was not available. The report covered new construction as well as renovation and alteration projects that began during the period, and refers to the value of the projects upon completion.
Most of the public sector construction was initiated by the New York City School Construction Authority, which started 900 projects valued at $3.1 billion, according to the report. Private schools initiated $174 million of projects in the city during that period.
The city has relied on bonds secured by state aid issued by the New York City Transitional Finance Authority for most of its public school financing. The TFA sold $1.32 Billion of building aid revenue bonds in calendar 2008 and $1.65 billion in 2009, according to Thomson Reuters.
The education sector, which includes higher education as well as primary and secondary schools, accounted for 56% of all institutional construction starts during the 24-month period covered by the report. In higher eduction, private colleges and universities outpaced public institutions by starting $744 million of projects compared to $540 million for public colleges such as the City University of New York.
Hospitals and health care facilities accounted for $1.96 billion of construction starts during the time period covered by the report. Most of that — $1.4 billion —was begun by private institutions.
Cultural institutions and court facilities accounted for $764 million and $600 million, respectively, of construction starts, the report said.
“New York City is extremely fortunate to serve as the home for many of the world’s leading educational, cultural, research and health care institutions,” New York Building Congress president Richard Anderson said in a press release. “While they are not immune to the same funding challenges that face other sectors, the demand for their services is much less dependent on the overall state of the economy than the office and residential sectors.”
The recession and credit crunch have slowed construction work in the city but there are signs of growth. First-quarter institutional construction starts hit $1.1 billion in 2010 compared to $325 million during the same period in 2009. The projects include a $650 million medical research building at the Joan and Sanford I. Weill Medical College and Graduate School of Medical Sciences of Cornell University, which is being partially financed through $285 million of bonds issued in June by the Dormitory Authority of the State of New York.
Overall construction starts in the in the city fell to $16.6 billion in 2009 compared to $23.3 billion in 2008, according to the trade association.