One constant in New York City is the constantly changing skyline, with construction sites and cranes dotting the horizon. But those sights may soon be fewer and farther between.
"Because of the lack of financing and because of the economic conditions a lot of the buildings that were proposed to be built are not being built," said Stephen Kliegerman, Halstead Property.
Louis Coletti of the Building Trades Employers Association says these casualties of the financial meltdown are causing a tremendous ripple effect throughout the construction industry.
"Many of my contractors have had projects either stopped completely, delayed before they started or stopped in mid stream. When that happens people get laid off and lose their jobs," said Coletti.
Coletti says there are 125,000 members of the building trades, and as we get deeper into 2009, he expects 50 to 60 percent of them to be unemployed.
"There's no demand for the construction services my members provide, if there's no demand we have no jobs to hire people for and until you break that cycle we could be facing depression like numbers in the nyc construction industry," said Coletti.
A major part of the problem -- lending. Banks used to require developers to supply 10 percent of a project's costs, but that number has shot up.
"Developers if they are going to build anything right now are looking to put 50 percent to 60 percent equity into a deal right now and no developer is going to do that," said Kliegerman.
As a result, the city department of buildings saw the number of new construction permits drop by a third, from almost 5,000 in 2007 to less than 3,200 in 2008.
"We're hearing layoffs are happening in architectural firms, in engineering firms, that's a really scary process because what that means is nobody is designing new projects," said Coletti.
And keep in mind, no new projects also means no new units to house the extra one million people the city expects to see over the next decade.
In short, Stephen Kliegerman of Halstead Property warns there may be a severe housing shortage, and the skyrocketing costs that go with supply and demand, if the lending spigot doesn't start flowing again and soon.
"If money were to loosen up, it certainly would eradicate some of what we see as the pent up demand for the future and soften what I believe is going to be quite a dramatic inflationary situation in 2011 and 2012," said Kliegerman.