Subscribe to TRD Data to see this content!
New York’s construction slowdown is hitting the city unevenly.
As developers grapple with tariff uncertainties, elevated borrowing costs and the city’s 485x tax abatement policy, new building permits are collapsing in parts of the outer boroughs even as Manhattan development continues to push ahead.
Approved permits for new buildings plunged nearly 28 percent year over year, according to a TRD Data analysis of Department of Buildings NOW portal filings. The study compared issued permits where contractors were listed as a projects’ applicants from March 1, 2024 through March 1, 2025 against the same period the following year.
“You’re seeing a variety of economic, political and policy issues all aligning at once, in terms of what’s constrainting production,” said Eli Weiss of Joy Construction, which focuses on affordable and supportive housing construction, mainly in the Bronx, and which ranked 15th overall, by total square footage, in the city.
In total, the city approved 746 permits for new buildings during that timeframe.
The industry last year faced significant macroeconomic questions surrounding President Donald Trump’s tariffs on many construction resources and higher interest rates.
“Construction costs are at an all-time high. The tariffs were really tough,” Weiss said. “Getting new projects started right now is not easy.”
There were also big political question marks, from the mayoral election to 485x, a tax abatement program that has a $40-per-hour minimum wage requirement on projects of at least 100 units, leading developers to construct smaller-scale, multifamily buildings with 99 units.
The plunge in approved new building permits was split geographically, falling in Staten Island and Queens and rising in the city’s other boroughs.
The drop was starkest in Staten Island, where they fell by nearly 89 percent year over year to just 20. Queens saw 164 approved new building permits, down more than 51 percent.
Weiss said the fall off in Queens was unsurprising, as the neighborhoods closer to Manhattan had been home to many projects that benefitted from 421a, the predecessor to 485x.
Projects in those regions effectively came to a stop, he said.
Meanwhile, Manhattan, home to some of the priciest-per-square-foot new developments in the city, recorded the greatest surge in new building permit activity. In Manhattan, the city greenlit 97 new building permits over the past year, a more than 24 percent hike compared to the year before.
Weiss described the construction industry as split, with a lot of successful projects on the high-end of the spectrum and a drop in the more affordable sectors of the market.
Brooklyn and the Bronx had the most permit approvals, of 299 and 166, respectively. While Brooklyn’s activity was effectively flat year over year, inching up just 0.7 percent, the Bronx’s climbed by more than 12 percent.