The Setback
R-05 Upcoming
Regulatory + Structural Vintage pending · Updated pending

New York City

The rules and the geology both say no, in different boroughs.

New York City: photography pending

Supply Scorecard

How New York City measures up

Supply scorecard: five-metric method
Metric Value
M1 Permits per 1,000 residents pending
M2 Median permit approval time pending
M3 Rental vacancy rate pending
M4 Median rent-to-income ratio pending
M5 Share of land zoned single-family pending

Figures are provisional pending source verification against the Census Building Permits Survey, HUD, FRED, and municipal planning data.

Constraint Diagnosis

Report in research. New York carries both constraints at once: a zoning code that still routes most multifamily construction through discretionary review in large parts of the city, layered on top of outer-borough land scarcity and Manhattan bedrock and lot conditions that cap what can rise economically without deep foundations.

Sources

Where these numbers come from

Every input behind this report's pro forma, and whether it's been checked against a real source yet.

Pro forma input sources for New York City
Input Value Source Year Link
Land cost $6,000,000 PENDING N/A N/A
Hard cost per unit $345,000 PENDING N/A N/A
Soft costs 24.0% PENDING N/A N/A
Permit timeline 24 mo PENDING N/A N/A
Construction timeline 18 mo PENDING N/A N/A
Construction loan rate 8.75% PENDING N/A N/A
Monthly rent per unit $3,350 PENDING N/A N/A
Vacancy & credit loss 5.0% PENDING N/A N/A
Operating expense ratio 37.0% PENDING N/A N/A
Exit cap rate 4.75% PENDING N/A N/A
Required spread over exit cap (drives required return = exit cap + spread) 1.25% Industry convention for ground-up multifamily; developers in 2026 generally require 6%+ development yield with a minimum 125-150bps spread over exit cap. Practitioner range 125-175bps, with urban-core deals occasionally below 100bps. CBRE notes the historical premium was approximately 200bps and has compressed. This model uses the low end of that range (125bps), matching the developer_spread input in R-01's sourced Washington, D.C. analysis. See also: https://dancap.ca/2025-outlook-real-estate/ 2026 View source