Tall Buildings Report Finds NYC Most Expensive

NEW YORK CITY -- New York remains the most expensive city to build high rise buildings in the world, according to a new report from Turner & Townsend, which provides a unique perspective on the market for tall buildings across six global cities.

The Global Tall Buildings report draws on Turner & Townsend’s exclusive data to provide insights into the challenges and opportunities facing developers building skyscrapers in London, New York, Seoul, Tokyo, Mumbai, and Dubai, including costs and the impact of designs and height on viability.

The report found that the cost of delivering a new office building in New York has increased by up to 30 percent since 2020 and it is now more than three times as expensive to build skyscrapers in the city as it is in Seoul, and ten times as it is in Mumbai.

This significant cost rise is the result of a range of factors including persistently high interest rates, rising materials costs, and labor shortages, which are leading to some developers postponing new starts, particularly of large, new commercial projects.

Trade disputes and tariff measures are also adding to inflationary pressures, which is causing further uncertainty.

One key finding from the report is that the shape of a skyscraper is as important as the height when it comes to the overall cost. In some cities, there can be a 25 percent difference in price between the most ambitious and the most cost-efficient projects, with massing being a key determining factor.

New York was the birthplace of the modern skyscraper, and the city’s skyline in the early twentieth century was defined by a ‘race for the sky,’ typified by the Chrysler Building and The Empire State Building.

While originally the city’s zoning laws restricted developers to “wedding cake” designs, this typology has now expanded to include the high-value pencil thin residential towers overlooking Central Park, the development of a new high-rise district at Hudson Yards, and tall landmark headquarters for major corporations.

“Demand for tall buildings globally remains incredibly strong, and while New York remains the most expensive city in which to deliver skyscrapers in the world, there continues to be a lot of activity,” said Steve Watts, Head of Tall Buildings at Turner & Townsend. “Building in New York involves significant risks including supply chain stress, long and drawn-out regulatory processes and high labor cost rates, so a clear and careful strategy from the outset is required to ensure projects are not derailed.”

The report defines tall buildings as buildings with over 20 stories.

In recent years, viability constraints have led to a significant shift towards residential development, particularly office-to-residential conversions. In 2025, the New York metropolitan area led the nation with over 8,300 office buildings planned for conversion to apartments. Approximately 70 percent of floorspace construction predicted for 2025 was expected to be residential development, with much of that being alteration and renovation work.

That being said, industry sentiment remains positive and pragmatic, and public sector spending, particularly on large infrastructure projects, is facilitating the densification of the city via the creation of quicker and better commuter experiences. This is resulting in an environment where further tall buildings can be more easily accommodated.

Looking ahead, New York City's Local Law 97, which penalizes high carbon emissions, is spurring a boom in green construction and retrofitting, creating a new market niche and significant opportunities for firms specializing in sustainable building.

Turner & Townsend provides project management, cost and commercial management and program advisory services, and has helped deliver over 200 tall buildings across the world, including the likes of 22 Bishopsgate, London; 30 Hudson Yards, New York; The Jewel, Australia; and Piramal Aranya in Mumbai.

“Now more than ever, it is important to recognize that shape is as important as height when it comes to delivering a project cost efficiently,” said Watts, and there is an ever-increasing focus on ensuring tall buildings are integrated into the broader cityscape, whether that is by offering public amenities or a greater range of uses on the ground floors.

In this context, to deliver a successful project in New York, it is critical for project teams to work together at the outset to address viability issues: to test briefs; apply greater focus at an earlier stage to both design strategies and detailing; to secure the help of key parts of the supply chain sooner; and to set up projects with clarity and alignment.

“New York continues to have one of the most iconic skylines in the world, and with the right processes in place, there is no reason why the city can’t continue to lead the way for many years to come,” said Watts.
Turner & Townsend is majority-owned by CBRE Group, Inc., the world’s largest commercial real estate services and investment firm, with its partners holding a significant non-controlling interest.

For more, go to www.turnerandtownsend.com.