Cost to build tall buildings in New York jumped 30% since 2020

The cost to build tall buildings in New York City has spiked 30% since 2020, according to a report by the global professional services company Turner & Townsend.

New York remains the most expensive city in the world to build high rise buildings, the report says. The other cities examined were London, Seoul, Tokyo, Mumbai, and Dubai. It is now more than three times as expensive to build skyscrapers in New York as it is in Seoul, and ten times as much as in Mumbai.

Rising costs are due to persistently high interest rates, rising materials costs, and labor shortages, which are leading some developers to postpone new starts, particularly of large, new commercial projects. Trade disputes and tariff measures are also adding to inflationary pressures.

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

In recent years, viability constraints have led to a significant shift towards residential development in the tall building sector, with office-to-residential conversions gaining popularity.

In 2025, the New York metropolitan area led the U.S. with more than 8,300 office buildings planned for conversion to apartments. About 70% of high-rise floorspace construction predicted for 2025 was expected to be residential development, with much of that being alteration and renovation work.