Real estate development is providing a major boost to the Rochester area economy.
Adjusted for inflation, output at local construction and real estate rental and leasing firms has increased by $1.2 billion, or 22.4 percent, since 2007—nearly four times the 5.8 percent average gain for all U.S. metropolitan areas over this period (Figure 1).
Rochester’s growth since 2007 has exceeded all upstate peers—including neighboring Buffalo, recipient of the state’s “Buffalo Billion” economic development investment, and Albany, home to New York’s fast-growing nanotechnology industry (Figure 2).
Rochester’s growth is also evident in employment comparisons with the United States.
Adjusted for seasonal variations, the estimated 26,900 construction and
real estate rental and leasing jobs in the Rochester area in September were 1,400—5.5 percent—more than at the start of 2007. This compares with a 1.1 million, or 11 percent, decrease for the nation overall.
If Rochester’s construction and real estate-related employment had matched the U.S. trend, the local job count would be 4,200, or 15.6 percent, below the current total. To put this in perspective, construction and real estate jobs have accounted for nearly one quarter of the Rochester area’s total private-sector employment growth since the start of 2007.
Rochester’s construction and redevelopment boom largely has focused on the downtown core, with a strong mix of commercial, residential, academic and public-sector projects.
According to a tally by the Rochester Downtown Development Corp., an estimated $857.1 million in projects are planned, under construction or already completed in the downtown area.
These projects are transforming the downtown landscape—with the most notable impact being the significant increase in residential redevelopment that is drawing new residents and spending to the city’s core.
Construction and real estate investment should continue to boost the Rochester economy in 2017, setting the stage for further long-term growth.
Gary Keith is vice president and regional economist at M&T Bank Corp.
10/28/2016 (c) 2016 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email firstname.lastname@example.org.