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Rubin Report - The Pulse of the NYC Development / Issue No. 29 - May 2025

Rubin Isak

Welcome to Issue Number 29 of The Rubin Report: The Pulse of the NYC Development Market.

The development site market is surging. At DSA we sold four (4) development sites, totaling north of $55 Million in just the last 60 days that accounts for well over 200,000 Zoning Floor Area (ZFA), with many more exclusively listed and also under hard contract.

In this report I also cover 50 New Building and Major Alteration Development Projects filed in just the last 3 weeks alone. These filings account for over 6.1 million ZFA and over 3,000 Dwelling Units.

Great news on the Tariff front: An important temporary de-escalation agreement between the US & China has just been struck.

Key Provisions of the Deal:

The agreement, effective from May 14, 2025, includes the following core elements:

Tariff Reductions for 90 Days:

U.S. Actions: The U.S. will reduce tariffs on Chinese imports from 145% to 30% for 90 days. This includes suspending the 34% reciprocal tariff imposed on April 2, 2025, but retaining a 10% baseline tariff.

Chinese Actions: China will lower its retaliatory tariffs on U.S. goods from 125% to 10% for 90 days, suspending its 34% tariff announced on April 4, 2025. China will also suspend or remove non-tariff countermeasures, such as restrictions on U.S. lumber and soybean imports, implemented since April 2025.

See you in Vegas?

We will be at the ICSC Convention in Las Vegas next week. I have sold property on the floor of this convention and have also made deals at the Wynn pool! Let’s meet if you plan on being there as well.

In This Issue:

Just Sold Exclusively: A $8,500,000 development site in Astoria & A $3,500,000 stalled development site in Lower Manhattan
A Huge Thank You to Our Wonderful Clients!
Q1 2025 Construction Costs Report
Recent New Building Filings
Today’s Financial Market Snapshot
Make sure to read our invaluable Spring 2025 Development Whitepaper
Introducing our New Service Line: Development Management Services!

Just Sold: A Stalled Development Site in Lower Manhattan | $3.5 Million

Address: 15 Catherine Street

Neighborhood: Two Bridges/Chinatown

Asset Class: Vacant Land

Location: Bet. E. Broadway & Henry Street

Lot Dimensions: 27.17’ x 113.33’

Lot SF: 3,024 SF

Zoning District: C6-1G

Feasible ZFA: 13,461 ZFA

Sale Date: 4/30/2025

Sale Price: $3,500,000

Note: Development Site Advisors was the sole broker in this transaction representing the seller and identifying the buyer. Closed in a true all-cash transaction in 120 days.

Testimonial from Seller:

"Rubin & Lev, thank you for your help getting this sold. You guys were truly some of the most effective, professional, and responsive brokers I have worked with. I would happily use you again in the future and will be sure to refer you given the opportunity. Looking forward to the next one!"

*2nd broker in: The property sat on the market with a global commercial real estate firm for 710 days. Once we were hired, we marketed only the feasible ZFA and found the buyer within 24 hours!

Just Sold: A 3-Lot Assemblage in Astoria | $8.5 Million

Address: 26-28, 26-30 & 26-34 28th Street

Neighborhood: Astoria

Asset Class: Vacant Land + Mixed-use Bldg

Location: Bet. Astoria Blvd & Newtown Ave

Lot Dimensions: 93' x 185'

Lot SF: 15,998 SF

Zoning District: R6B/R6A/C2-3

ZFA: 31,996 ZFA

Sale Date: 4/25/2025

Sale Price: $8,500,000

Note: Development Site Advisors was the sole broker in this transaction representing the seller and identifying the buyer. Closed in a true all-cash transaction in 45 days.

Testimonial from Seller: "Thank you very much, Rubin and Lev, for going above and beyond to get this across the finish line…I especially appreciated your responsiveness and patience! My family and I are very fortunate to know you two."

*Congratulations to the sellers, an amazing family and clients, for putting your trust in us again.

Construction Costs Outlook

Q1 2025 Construction Costs & Market Trends

Cumming Group just released its U.S. Construction Market Overview. Here is a summary with some added insights. In Q1 2025, the U.S. construction industry faced rising material costs, labor shortages, and tariff-driven uncertainties, impacting project budgets and timelines. The Northeast, especially the NYC metro area, grapples with acute housing shortages (1 million+ units needed) and high construction costs, driven by volatile material prices and regulatory complexities. Despite challenges, residential construction shows resilience with 12% projected annual growth, fueled by demand for affordable suburban housing. Adaptive reuse of commercial properties and infrastructure investments offer opportunities to address housing needs and stimulate the market.

Key Market Trends

Material Cost Volatility:
Steel, lumber (up 5-8%), and concrete (up 2-3%) prices rose due to tariffs on imports from Mexico, Canada, and China, alongside supply chain disruptions. The Federal Reserve Bank of St. Louis’ Producer Price Index for construction materials increased 3.2% in Q1 2025.
NYC Impact: High material costs exacerbate already elevated construction expenses, particularly for residential and high-end projects.
Recommendation: Include cost escalation clauses and force majeure provisions in contracts. Source local or alternative materials to mitigate price shocks.
Labor Market Pressures:
Construction unemployment is low at 4.2%, reflecting a tight labor market with 7.9 million workers. Labor shortages, potentially worsened by immigration policies, drive wage increases.
NYC Impact: Skilled labor scarcity delays projects and inflates costs, especially for complex developments.
Recommendation: Invest in workforce training and adopt technologies like modular construction to reduce labor dependency.
Residential Construction Resilience:
U.S. housing starts rebounded 11.2% in February to 1.5 million units annually, with 12% growth projected for 2025, driven by declining interest rates (30-year mortgage at 6.65%) and suburban demand.
NYC Challenge: A 1 million-unit housing shortfall persists, with recent developments skewed toward luxury, unaffordable units.
Opportunity: Adaptive reuse of underutilized commercial properties (e.g., office-to-residential conversions) gains traction as commercial real estate values decline, though high conversion costs and regulatory hurdles remain.
Infrastructure and Non-Residential Growth:
Federal infrastructure spending fuels projects like manufacturing facilities, data centers, and hospitals in the Northeast. The Architectural Billings Index (ABI) at 44.1 signals declining commercial activity, but institutional and infrastructure sectors remain stable.
NYC Opportunity: Data centers and healthcare facilities present long-term anchors for mixed-use and affordable housing developments.
Recommendation: Partner with public entities to leverage federal funds for infrastructure-led urban redevelopment.
Economic Context:
U.S. GDP growth is projected to decline 2.4% in Q1 2025, driven by tariff-related import surges and inflation (CPI at 2.4%, projected to hit 2.9% annually). The 10-year Treasury yield (4.39%) and rising energy costs (natural gas up to $4.19/MMBtu) add financial pressure.
NYC Impact: Higher borrowing costs and inflation challenge project viability, particularly for high-cost residential and hospitality developments.
Recommendation: Lock in financing early.

Northeast Construction Costs

The NYC metro area faces some of the highest construction costs in the U.S., reflecting material price hikes, labor shortages, and complex regulatory requirements. Below are Q1 2025 cost ranges for key property types:

Residential:
Rental: $320–$650/sf
Condominium: $430–$900/sf
Office:
Shell & Core: $300–$520/sf
Tenant Improvement: $170–$490/sf
Healthcare:
Hospital: $850–$1,790/sf
Medical Office: $460–$990/sf
Hospitality:
3-Star Hotel: $300–$610/sf
5-Star Hotel: $510–$1,200/sf
Education:
K-12: $380–$950/sf
Higher Ed: $550–$1,290/sf
Retail: $370–$870/sf
Life Sciences/Lab: $560–$1,670/sf
Parking Structures:
Above Grade Multi-Level: $27,000–$65,000/unit
Below Grade Multi-Level: $85,000–$167,000/unit

Strategic Recommendations for NYC Developers

Mitigate Cost Risks: Add 5–10% cost contingencies to budgets and negotiate flexible material sourcing contracts to hedge against tariff-driven price spikes.
Prioritize Adaptive Reuse: Target antiquated commercial properties for conversion to residential units, leveraging falling office values and growing permitting approvals.
Embrace Technology: Use prefabrication and Building Information Modeling (BIM) to streamline construction and reduce labor costs.

Outlook

The NYC development market in 2025 navigates a complex landscape of rising costs, labor constraints, and housing shortages. However, opportunities abound in adaptive reuse, infrastructure-driven growth, and residential demand. By adopting flexible contracting, leveraging technology, and aligning with policy incentives, developers can mitigate risks and capitalize on the region’s long-term potential.

NB Filings

The 50 New Building Major Alteration Projects Filed in the last 3-Weeks account for over 6.1 million ZFA and over 3,000 Dwelling Units. In Manhattan there have been 9 filings representing 4,379,510 ZFA & 1,223 Dwelling Units. In The Bronx there have been 8 filings representing 389,915 ZFA & 541 Dwelling Units. In Brooklyn there have been an amazing 25 filings representing 567,887 ZFA & 596 Dwelling Units and In Queens there has been 8 filings representing a strong 779,720 ZFA & 971 Dwelling Units.

MANHATTAN

126-128 Hester Street, Chinatown
Plans filed to build a 14,470 ZFA, 7-Story, 74-Foot Tall, 8-Unit Mixed-use Building
Zoning District: C6-1G
Lot Dimensions: 48.29’ x 50.32’
100 West 37th Street, Midtown South
Plans filed to build a 317,948 ZFA, 70-Story, 738-Foot Tall, 311-Unit Residential Tower
Zoning District: C6-6
Lot Area: 25,652 SF
570 5th Avenue, Midtown
Plans filed to build a 712,937 ZFA, 567-Foot Tall, 29-Story, Commercial Tower
Zoning District: C6-4.5 & C5-3
Lot Area: 61,500 SF
401 East 51st Street, Turtle Bay
Plans filed to build a 124,757 ZFA, 369-Foot Tall, 29-Story, 83-Unit Residential Tower
Zoning District: R10 & R8B
Lot Area: 11,321 SF
219 East 42nd Street, Turtle Bay
Conversion and Enlargement Plans Filed to create one (1), 416,615 ZFA, 348-Foot Tall, Mixed-use, 30-Story Tower with 544-Dwelling Units & 90,242 SF of Commercial Space
Additional Construction Floor Area: 256,636 SF
Exiting Building: A 1935 built, 9-Story plus penthouse Commercial Building
Constructing a 21-Story Residential Addition to the Existing Commercial Building
Cost: $96.4 Million
Zoning District: C5-3
Lot Area: 31,113 SF
288 East 88th Street, Yorkville
Plans filed to build a 304-Foot Tall, 24-Story, 89,413 ZFA, 75-Unit Apartment Tower
Zoning District: R8, C2-8
Lot Area: 11,092 SF
259 East 71st Street, Yorkville
Plans filed to build a 4-Story, 4-Unit Apartment Building
Zoning District: C1-9
Lot Width: 37 Ft
1655 1st Avenue, Yorkville
Plans filed to build a 235-Foot Tall, 23-Story, 146,158 ZFA, 198-Unit Apartment Tower
Zoning District: C2-8A
Lot Area: 12,182 SF
635 W 165th Street, Washington Heights
Plans filed to Construct a new building on the New York Presbyterian Hospital Campus
A 16-Story, 297 Foot-tall, 2,557,212 ZFA Community Facility Medical Building
Zoning District: R8
Lot Area: 402,014 SF

THE BRONX

261 Grand Concourse, Mott Haven
Plans filed to build two (2) 14-Story Apartment Buildings totaling 269,768 ZFA and 405 Dwelling Units with 138 Enclosed Parking Spaces
Zoning District: C6-2A
Total Lot Area: 38,360 SF
868 East 156th Street, Woodstock
Plans filed to build a 9-Story, 24,124 ZFA, 30-Unit Apartment Building
Zoning District: R7-1
Lot Area: 5,234 SF
1078 Hall Place, Longwood
Plans filed to build a 49-Foot Tall, 4-Story, 10,494 ZFA, 14-Unit Apartment Building
Zoning District: R7-1
Lot Area: 2,458 SF
1801 Weeks Avenue, Tremont
Plans filed to build a 12-Story, 119 Foot-Tall, 55,156 ZFA, 59-Unit Apartment Building
Zoning District: R8
Lot Area: 16,616 SF
1748 University Avenue, Morris Heights
Plans filed to build a 1-Story + Mezzanine, 13,599 ZFA Commercial Building
Zoning District: R7-1, C1-4 Overlay
Lot Area: 12,762 SF
2246 Bathgate Avenue, East Tremont
Plans filed to build a 4-Story + Penthouse, 13-Dwelling Unit, 8,066 ZFA Apartment Building.
Zoning District: R6A
Lot Area: 2,920 SF
4432 3rd Avenue, Belmont
Alteration plans filed for vertical and horizontal extension to create a 4-Story + Penthouse, 7-Family, 5,263 ZFA Apartment Building
Zoning District: R7A, C2-4
Lot Area: 1,780 SF
21 East 204th Street, Bedford Park
Plans filed to build a 4-Story + Penthouse, 5,445 ZFA, 13-Unit Apartment Building
Zoning District: R8
Lot Area: 2,103 SF

BROOKLYN

60 & 66 Gerry Street, Williamsburg
Plans filed to build Two (2), 6-Story, 68.8-Foot Tall, Apartment Buildings, totaling 29,805 ZFA
Zoning District: R7A
Lot Area: 10,000 SF
236 Gold Street, Downtown Brooklyn
Plans filed to build a 4-Story, 22,022 ZFA, 22-Unit Apartment Building with 11 Parking Spaces
Zoning District: R6B
Lot Area: 11,052 SF
91 Court Street, Downtown Brooklyn
Plans filed to build a 91-Foot Tall, 9-Story, 30,825 ZFA, 29-Unit Apartment Building with Ground Floor Retail
Zoning District: C6-2A
Lot Area: 5,266 SF
64 Franklin Avenue, Bedford Stuyvesant
Alteration plans filed to create a 68-Foot Tall, 6-Story + Cellar 15,362 ZFA Community Facility Building
Zoning District: M1-2
Lot Area: 4,898 SF
448 Park Avenue, Bedford Stuyvesant
Plans filed to build a 6-Story, 9,564 ZFA, 5-Unit Apartment Building
Zoning District: M1-4/R6A
Lot Area: 3,256 SF
16 Woodbine Street, Bushwick
Alteration plans filed for a horizontal and vertical enlargement of an existing 2-Story building to create a 4-Story, 9-Family Apartment Building with 6 new units and 6,486 ZFA
Zoning District: R6
Lot Area: 2,950 SF
729 Van Sinderen Avenue, East New York
Plans filed to build a 11-Story, 112,354 ZFA, 167-Unit Apartment Building.
Zoning District: C4-4L
Lot Area: 22,500 SF
12495 Flatlands Avenue, New Lots
Plans filed to build a 2-Story, 26,138 ZFA, Commercial Building
Zoning District: M1-1
Lot Area: 26,908 SF
2753 Atlantic Avenue, East New York
Plans filed to build a 14-Story, 107,520 ZFA, 150-Unit Apartment Building with 22 Enclosed Parking Spaces & 7,371 SF of Commercial Space
Zoning District: R8A, R5B, MIH
Lot Area: 16,500 SF
143 9th Street, Gowanus
Alteration plans filed for a horizontal and vertical enlargement from an existing 3-family home to a 4-Story, 5,000 ZFA, 7-Family Apartment Building
Zoning District: M1-4/R6B
Lot Area: 2,500 SF
655 Baltic Street, Park Slope
Plans filed to build a 4-Story, 4-Family, 3,992 ZFA Apartment Building
Zoning District: R6B
Lot Area: 2,000 SF
13 5th Street, Gowanus
Plans filed to build a 5-Story, 4,385 ZFA, 3-Family Home
Zoning District: M1-4/R6B
Lot Area: 2,200 SF
280 19th Street, Greenwood
Plans filed to build a 50-Foot Tall, 5-Story, 5,005 ZFA, 6-Unit Apartment Building
Zoning District: R6B
Lot Area: 2,504 SF
259 22nd Street, Greenwood
Plans filed to build a 63,665 ZFA, 4-Story, Mixed-use Building with 40 Apartments, 21-Parking Spots and 16,827 ZFA of Community Facility Space
Zoning District: R6B
Lot Area: 38,141 SF
1025 Pacific Street, Crown Heights
Alteration Plans filed to build a 64.5-Foot-Tall, 6-Story, 12,771 ZFA, 8-Unit Apartment Building with Ground Floor Retail
Zoning District: R7A
Lot Area: 3,200 SF
1260 Prospect Place, Weeksville
Alteration plans filed for horizontal and vertical enlargement of an existing 3-Story Building to create a 4-Story + Penthouse, 6,832 ZFA, 10-Unit Apartment Building
Zoning District: R6
Lot Area: 3,195 SF
822 Bergen Street, Crown Heights
Plans filed to build a 19,617 ZFA, 7-Story, 22-Unit Apartment Building
Zoning District: R6A
Lot Area: 6,550 SF
530 St Marks Avenue, Crown Heights
Plans filed to build a 8-Story, 13,771 ZFA, 20-Unit Apartment Building
Zoning District: R7A
Lot Area: 3,469 SF
33 Bay 20th Street, Bath Beach
Plans filed to build a 4-Story, 5,797 ZFA, 5-Unit Apartment Building
Zoning District: R5
Lot Area: 3,866 SF
4613 5th Avenue, Sunset Park
Plans filed to build a 6-Story, 12,480 ZFA, 6-Unit Mixed-use Building with 5,200 ZFA of Community Facility Space on the 1st and 2nd Floors
Zoning District: R6
Lot Area: 3,400 SF
828 50th Street, Sunset Park
Alteration plans filed for vertical and horizontal enlargement of an existing 2-Story, 2-Family building to create a 4,996 ZFA, 4-Story, 4-Family, Mixed-Use Building w/ Ground Floor Community Facility space
Zoning District: R6
Lot Area: 2,010 SF
598 Saratoga Avenue, Brownsville
Alteration Plans filed to build a 4-Story, 7,613 ZFA, 10-Unit Apartment Building
Zoning District: R6
Lot Area: 2,601 SF
436 Blake Avenue, Brownsville
Plans filed to build a 5-Story, 12,563 ZFA, 17-Unit Mixed-use Building
Zoning District: R6
Lot Area: 3,000 SF
193 Grafton Street, Brownsville
Plans filed to build a 4-Story, 5,239 ZFA, 8-Unit Apartment Building
Zoning District: R6
Lot Area: 2,416 SF
789 East 91st Street, Canarsie
Plans filed to build a 1-Story + Mezzanine, 33,649 ZFA Commercial Building
Zoning District: M1-1
Lot Area: 46,000 SF

QUEENS

23-06 40th Avenue, Long Island City
Alteration plans filed for Vertical Enlargement to create a 4-Story, 7,285 ZFA, 6-Unit Apartment Building
Zoning District: M1-2/R5D
Lot Area: 2,504 SF
3-01 26th Avenue, Astoria
Plans filed to build a 34-Story, 528,891 ZFA, 687 Unit Apartment Tower on the Astoria Waterfront
Zoning District: R7-3
Lot Area: 164,392 SF
42-19 24th Street, Hunters Point
Plans filed to build a 408-Foot-Tall, 38-Story, 187,468 ZFA, 207-Unit Apartment Tower
Zoning District: M1-5/R9
Lot Area: 24,464 SF
43-09 52nd Street, Woodside
Plans filed to build a 11-Story, 27,181 ZFA, 35-Unit Apartment Building
Zoning District: R6/R7A
Lot Area: 6,000 SF
55-34 97th Place, Corona
Plans filed to build a 6-Story, 7,665 ZFA, 9-Unit Apartment Building with Ground Floor Community Facility Space
Zoning District: R6B
Lot Area: 3,333 SF
58-32 76th Street, Middle Village
Plans filed to build a 3-Story, 2,114 ZFA, 3-Family Building
Zoning District: R4
Lot Area: 2,115 SF
101-04 115th Street, South Richmond Hill
Plans filed to build a 4-Story, 8,744 ZFA, 8-Unit Apartment Building
Zoning District: R6B, C2-3
Lot Area: 4,384 SF
97-36 Brisbin Street, South Jamaica
Plans filed to build a 4-Story, 10,639 ZFA, 16-Unit Apartment Building
Zoning District: R5
Lot Area: 5,569 SF

Financial Market Snapshot:

Federal Prime Rate: 7.5%
Secured Overnight Financing Rate (SOFR): 4.28%
United States Effective Federal Funds Rate: 4.33%
United States Annual Inflation Rate: 2.4%
US 1-Year Treasury Rate: 4.128%
US 2-Year Treasury Rate: 4.004%
US 3-Year Treasury Rate: 4.001%
US 5-Year Treasury Rate: 4.112%
US 7-Year Treasury Rate: 4.285%
US 10-Year Treasury Rate: 4.471%
Treasury Bill Auction Rates:
13-Week Term: 4.300%
26-Week Term: 4.105%
US Bonds:
20-Year Bond: 4.810%
30-Year Bond: 4.819%
Mortgage Rates:
30-Year Fixed Rate: 6.92%
15-Year Fixed Rate: 6.27%
5-Year ARM: 6.58%
Ground Up Construction Rates: 8.53%+
Hard Money Lending Rates: 11%+

Spring 2025 Development Whitepaper

Get smart on all things development. We put together the best minds of NYC real estate development and compiled it into an invaluable resource for you! Check out our Spring 2025 Development Whitepaper

Our New Service Line: Development Management!

At DSA, we’re not just selling sites, we are shaping the future of NYC real estate with our new Development Management service line. We create and transform assets with sustainability at the core, leveraging our deep market expertise, in-house architects, and zoning specialists to deliver unmatched value.

What We Offer:

Development Management
Make informed decisions with confidence. Our team provides comprehensive predevelopment analysis and viability assessments, powered by proprietary data and market insights. We help you invest wisely to maximize returns, whether it’s a Queens rental project, a Brooklyn condo development or a Manhattan conversion.

Owner’s Representation

Your project. Fully managed.

As your trusted development partner, we oversee the entire process, from initial vision to final approvals and execution. We identify risks early, uncover hidden opportunities, and manage entitlements, permitting, and stakeholder coordination to keep your project moving. Our proven track record speaks to our ability to deliver on time, on budget, and beyond expectations.

Want to know what your property is worth as a development site today? Let’s talk.