NEW YORK CITY-Private developers—especially in office—aredriving an uptick in construction spending even as government'sshare is ebbing, the New York Building Congresssaid Monday. The association projects overall construction spendingin the city to reach $37.3 billion in 2014, up 24% from 2012 and upeven more sharply from '14 projections the association made lastOctober.

At that time, the Building Congress forecast spending of $30.2billion in 2013—its revised forecast calls for spending of $32billion this year—and $29.1 billion in 2014. “The upward revisionsin our forecast, from data compiled over the past few months,particularly for the private sector, are extremely encouraging,”Building Congress president Richard T. Andersonsays in a release. Although the effects of inflation andpost-Sandy rebuilding are contributing factors, “there is no doubtthat much of the gain is fueled by increased private-sectordevelopment activity and an improving economy.”

That private-sector uptick—including officeproperty and hotel development—is part ofan overall 38% gain in projected non-residential constructionspending this year, the Building Congress says. Office inparticular is powering the increase after virtually disappearingfrom the map during the downturn. The Building Congress projectsnearly 2.5 million square feet of Manhattan office space will beadded this year, and another 3.9 million square feet nextyear.

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Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.