The 2018 International Construction Market Survey by Turner and Townsend revealed that New York has the highest construction costs in the world. On average, you can expect to invest $302/square foot. in a high-rise multifamily building and $565/square foot. in an office building.
High construction costs have led to a shortage of affordable housing, and the Di Blasio administration responded with the Housing New York 2.0 plan – delivering 300,000 new affordable housing units by 2026. There was already a goal of 200,000 units by 2024, but it will likely be achieved two years earlier, in 2022.
The lack of affordable housing also leads to traffic congestion, as many people who work in New York have moved to neighboring cities with lower rental rates. In other words, more affordable housing would help solve not one, but two of the main challenges facing municipal government.
Applying Modular Construction in Affordable Housing
Building affordable housing projects is a significant challenge in the world's most expensive city to build, largely because both land and skilled labor are expensive. Consider that skilled worker wages in New York often exceed $100/hour.
The concept of modular construction is very promising, as it allows a building to be manufactured externally in modules at a lower cost. These modules are then transported to the project site, where they are assembled in just a fraction of the time required with conventional construction methods.
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Although Idylls is a luxury project, the main advantage of modular construction is cost savings, making it a potential answer to New York's affordable housing shortage. Aware of this, the New York City Department of Housing Preservation and Development (HPD) issued a Request for Proposals (RFP) for an affordable building using modular construction. Following are some important facts about the project:
- This is the first time New York has issued an RFQ for an affordable housing project with modular construction. The New York government plans to replicate the concept in future developments based on the experience of this project.
- The project will be built on city-owned land. The L-shaped property has an area of 49,397 square feet. and is located in East New York, Brooklyn, near the Grant Avenue “A” train station.
- The RFP specifies 100% affordable housing units. The project is a mixed-use, mixed-income development as part of the Housing New York 2.0 plan. The lowest-cost units will be affordable for a family of three making just $28,170.
- The property can accommodate between 62 and 100 housing units, according to NYC HPD. Proposals with a significant number of units for high- and low-income families will be preferred.
- The deadline for submitting proposals is September 10, 2018.
The East New York neighborhood, where the project will be located, was recently rezoned to encourage housing development. Given that zoning rules often limit the applicability of modular construction, strategic rezoning is a key element of the Housing New York 2.0 plan. It is important to note that modular construction does not compromise compliance with building codes. There is a common misconception that modular buildings are lower-level structures, but this is simply not the case.
