A rendering of the University Pointe building at Portland State University

Public universities are increasingly turning to the private sector to build and finance the construction of the dorms where their students are housed, the New York Times reported.

The arrangements between universities and developers are mutually beneficial, as they free up capital for schools’ other costs while allowing the developer to profit, since their construction costs are lower due to economies of scale. But critics say that the savings are not being passed on to students. [more]

Determined to cut costs at its $4 billion Hudson Yards project, the Related Companies has reached outside the typical pot of New York City contractors and inked a California company. Crain’s said the impact of the unusual selection could reverberate throughout the city’s local construction industry.

Related chose Tutor Perini Corp. for the project because, unlike its New York counterparts, the firm owns subcontractors that can complete all facets of the construction project. [more]

New York City lost 900 construction jobs in September and added 100 real estate sector jobs, according to an Eastern Consolidated report with the most recent city employment data from the New York State Department of Labor.

Overall, the city lost 13,500 jobs last month, including 8,700 private sector jobs, marking a correction in an otherwise positive trajectory of job growth.

“Since bottoming in September 2009, New York City has added 82,200 jobs, or 2.2 percent. The U.S. has added 2.09 million jobs since its nadir, February 2010, a growth rate of 1.6 percent,” the report says. “The city is 36,400 private sector jobs short of its peak in April 2008, or 1.5 percent below. The U.S. remains 6.26 million private sector jobs short of its peak in January 2008, or 5.4 percent below.” – Katherine Clarke [more]

An Irvington, N.Y., woman was charged with stealing millions from members of the construction workers’ union, Local 147. Melissa King, 60, pleaded guilty in Manhattan federal court on Friday to stealing some, but not all, of the $42 million she was charged with embezzling from pension and employee benefit plans from her company, King Care, which administered benefits on behalf of Local 147, LoHud.com reported. “Um, I plead guilty, but I don’t plead guilty to millions of dollars,’’ King said. According to U.S. Attorney for the Southern District of New York Preet Bharara, King used the millions to fund an extravagant lifestyle, which included spending millions on antique jewelry and horses.
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From left: Port Authority Executive Director Chris Ward, Silverstein Properties CEO Larry Silverstein and 4 World Trade Center

After a five-month effort, the Port Authority of New York & New Jersey has found a way to sell bonds financing the World Trade Center construction while appeasing existing Port Authority bondholders. According to the Wall Street Journal, without an agreement, Silverstein Properties would not have enough funding to complete construction on the 72-story 4 World Trade Center.

Port Authority had wanted to issue World Trade Center bonds. To ensure low interest rates it had intended to make the debt obligations on those bonds a priority over the general obligation bonds the agency had previously sold. [more]

Travel and automotive agency AAA doesn’t want bridge and tunnel fare hikes to fund the World Trade Center development, the Associated Press reported.

The agency is pleading with the U.S. Department of Transportation to block the Port Authority of New York & New Jersey’s plans to increase toll fees by up to 50 percent on the grounds that they violate a 1987 federal law requiring bridge tolls to be “just and reasonable.”

But the agency wants to block the costly hikes because it feels transportation revenue should be used to improve transportation. [more]

Building permit activity has fallen since the crash in 2007, but there are signs that builders have almost completely stopped activity in a number of states, where no one seems to want to buy a new home. At the top (or bottom) of the list is Rhode Island, where building permits have declined 70.81 percent in the last six years, and there are just 312 building permits so far this year. New York, which has one of the largest housing markets in the country, has seen 11,033 building permits in 2011, but that number is a 61.8 percent drop from 2005 — and less than half of the 28,921 permits taken out in 2005. Florida is not among the top 10. [MSNBC]

Around $6.4 billion worth of construction projects were started in the first half of 2011, a nearly 40 percent decline from the first half of 2010, when construction starts reached $10.6 billion, New York Building Congress’ analysis of McGraw-Hill Construction Dodge data covering January through June shows.
The McGraw Hill data encompasses all new construction as well as alterations and renovations to existing structures.
Construction starts in the non-building sector — bridges, highways and mass transit — fell by 38 percent, from $1.7 billion in the first six months of 2010 to $1 billion during the same period this year. Construction starts in the residential sector dropped to $840 million in the first half of 2011, compared to $1.3 billion in the first half of 2010. — Katherine Clarke [more]

Though still below 2008 levels, new construction permits in New York City are on the rise, an indication that developments may be back on track, the Wall Street Journal reported.
Permits for new buildings, alterations and demolition rose by approximately 12 percent during the first half of 2011 compared with the same period last year, according to new data from the Department of Buildings. Demolitions — normally a firm indicator of brand new projects — jumped by 14 percent.
“More construction permits mean more people are going to work,” Buildings Commissioner Robert LiMandri said.

Private developers are still experiencing difficulty when it comes to financing big projects, said Richard Anderson, president of the New York Building Congress, as lenders tighten their restrictions. [more]

Low national employment in construction and government are large factors responsible for the bleak recovery so far, economist Floyd Norris wrote in the New York Times. In previous recoveries before 1990, construction was often a leading contributor to economic growth. According to Norris, this was because earlier recessions were often caused by the Federal Reserve bank pushing up interest rates, leading to a cut-off in the supply of mortgage credit. As a result, when banks could lend again, construction activity would increased markedly. In this case, construction is down in spite of low interest rates, as easy credit led to significant overbuilding. The slump in construction employment, beginning in 2006, has continued, even after the National Bureau of Economic Research concluded that the recession was over. [more]