New York City is building again. Construction spending is forecast to reach $79.8 billion in 2026, up $10 billion from last year, according to the New York Building Congress, with $242.9 billion expected over the three years through 2028. Housing is driving the boom, and the next five years look strong — if the policy winds hold.
Housing Leads the Way
Residential work is the engine: nearly $27 billion in 2026, and 64 percent higher over 2026–2028 than the previous three years. Permits are expected for roughly 31,500 new homes this year — up from 19,724 in 2025 — rising to nearly 35,000 by 2028, thanks to large rezonings in Gowanus, Long Island City and Midtown South and the City of Yes reforms.
Office-to-residential conversions are a big part of it: in the first half of 2026, the city permitted 74 conversion projects creating about 10,100 homes — a third of all newly permitted units. Since 2023, conversions have been approved for more than 19,700 homes, more than in the entire 2010–2022 period.
Beyond Housing
Non-residential spending is forecast at $29 billion in 2026. Three licensed casino projects account for about $17.6 billion — Hard Rock’s $8.1 billion Metropolitan Park near Citi Field, Resorts World’s $5.5 billion Aqueduct expansion, and Bally’s $4 billion Bronx development — while new office towers keep the commercial pipeline full.
The Headwinds
The outlook is not without risk. High interest rates, tariffs on building materials, and withheld federal infrastructure funding all threaten the pipeline, and the 485-x affordable housing tax break needs broadening to keep projects viable. The city’s $173.4 billion ten-year capital plan faces the same squeeze.
Even so, the direction is clear: after years of housing shortages and a post-pandemic lull, New York is building homes, converting offices, and betting big on entertainment. If rates ease and the incentives hold, the next five years could reshape the skyline — and finally dent the housing crisis.