A Century of New York City’s Evolving Skyline
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Over New York City’s storied history, the skyline has evolved constantly.
Smoke stacks and cathedral spires were gradually eclipsed by the stately office towers of “Newspaper Row”, and iconic skyscrapers like the Chrysler Building soon shared the skyline with monolithic towers in the international style.
Today’s infographic comes to us from Liberty Cruise NYC and it charts this evolution over the last century, while highlighting just how dramatically the cityscape is set to change by 2020.
The Early History of Skyscrapers
For decades, the ornate spire of Trinity Church towered over Lower Manhattan. It wasn’t until the late-1800s when technology and economic might converged to produce the first modern towers.
The city’s first cluster of tall buildings appeared around City Hall, as newspapers competed to see who could build the most grand headquarters. One of the more ambitious projects in this wave of development was the New York World Building (1890), which held the title as the tallest skyscraper in the world.
In 1908, the ante was upped further after the completion of the 47-storey headquarters of the Singer Sewing Machine Company and the 50-storey Metropolitan Life Tower. NYC was slower than its rival, Chicago, in adopting skeleton-frame construction techniques, but once that door was open, height records were eclipsed every few years.
From ’20s to zero
The roaring ’20s ushered in a new age of skyscrapers in New York City that only picked up steam heading into the 1930s. Not only was the economy booming, but the United States had recently became one of the first countries in the world to have a majority-urban population. Manhattan was a magnet for growth, and its extreme population density left only one direction to grow: skyward.
A number of iconic landmarks were constructed in this era, including the Empire State and Chrysler Buildings.
As the chart above clearly illustrates, the onset of the Great Depression had a pronounced cooling effect on construction in New York City. For more than a decade, no new 150m+ towers were added to the city’s skyline.
New York Today
The world has changed a lot since the ribbon was cut in front of the Empire State Building. Flagship skyscrapers have grown taller than we ever could’ve imagined, and relentless development has completely transformed places like Dubai and Shenzhen. Even so, New York City is still home to more 100m+ buildings than any other city on Earth.
It’s also worth mentioning that New York City found itself back in the top 10 tallest buildings list after the completion of One World Trade Center in 2014.
What the Future Holds
New York City’s skyline is packed with recognizable towers, but for a long time, few new projects challenged the vertical supremacy of buildings like MetLife or Empire State. Today – thanks to engineering innovations and acquisition of “air rights” on neighboring plots – the skyline is undergoing a dramatic transformation.
Powered by a healthy ultra-high-end real estate market, slender skyscrapers are rising above the skyline.
This style of building uses a small land footprint so effectively, that projects are springing up around the city. According to Skyscraper Center, there are 86 skyscrapers under construction or planned, with 10 projects set to surpass the height of the Chrysler Building.
While this level of construction is dwarfed by activity in fast-growing metropolises in China, this new generation of high-visibility towers is a sign that the Big Apple is still a strong draw for the world’s ultra-wealthy.
The World’s Largest Real Estate Investment Trusts (REITs)
Real estate investment trusts (REITS) are a simple alternative for investors looking to gain exposure to real estate.
The World’s Largest Real Estate Investment Trusts (REITs)
Real estate is widely regarded as an attractive asset class for investors.
This is because it offers several benefits like diversification (due to less correlation with stocks), monthly income, and protection from inflation. The latter is known as “inflation hedging”, and stems from real estate’s tendency to appreciate during periods of rising prices.
Affordability, of course, is a major barrier to investing in most real estate. Property markets around the world have reached bubble territory, making it incredibly difficult for people to get their foot in the door.
Thankfully, there are easier ways of gaining exposure. One of these is purchasing shares in a real estate investment trust (REIT), a type of company that owns and operates income-producing real estate, and is most often publicly-traded.
What Qualifies as REIT?
To qualify as a REIT in the U.S., a company must meet several criteria:
- Invest at least 75% of assets in real estate, cash , or U.S. Treasuries
- Derive at least 75% of gross income from rents, interest on mortgages, or real estate sales
- Pay at least 90% of taxable income in the form of shareholder dividends
- Be a taxable corporation
- Be managed by a board of directors or trustees
- Have at least 100 shareholders after one year of operations
- Have no more than half its shares held by five or fewer people
Investing in a REIT is similar to purchasing shares of any other publicly-traded company. There are also exchange-traded funds (ETFs) and mutual funds which may hold a basket of REITs. Lastly, note that some REITs are private, meaning they aren’t traded on stock exchanges.
The Top 10 by Market Cap
Here are the world’s 10 largest publicly-traded REITs, as of March 25, 2022.
|REIT||Market Cap||Dividend Yield||Property Type|
|Prologis (NYSE: PLD)||$116.4B||2.03%||Industrial|
|American Tower (NYSE: AMT)||$109.8B||2.38%||Communications|
|Crown Castle (NYSE: CCI||$76.8B||3.35%||Communications|
|Public Storage (NYSE: PSA)||$65.9B||2.14%||Self-storage|
|Equinix (NYSE: EQIX)||$64.4B||1.74%||Data centers|
|Simon Property Group (NYSE: SPG)||$48.9B||5.07%||Malls|
|Welltower (NYSE: WELL)||$43.0B||2.58%||Healthcare|
|Digital Realty (NYSE: DLR)||$40.1B||3.55%||Data centers|
|Realty Income (NYSE: O)||$40.1B||4.44%||Commercial|
|AvalonBay Communities (NYSE: AVB)||$34.6B||2.62%||Residential|
As shown above, REITs focus on different sectors of the market. Understanding their differences is an important step to consider before making an investment.
For example, Prologis manages the world’s largest portfolio of logistics real estate. This includes warehouses, distribution centers, and other supply chain facilities around the globe. It’s reasonable to assume that this REIT would benefit from further growth in ecommerce—more on this near the end.
Realty Income, on the other hand, owns a portfolio of over 11,100 commercial real estate properties in the U.S. and Europe. It rents these properties out to major brands like Walgreens and 7-Eleven, which together account for 8.1% of the REIT’s annual income.
More Than Just Buildings
Cell towers and data centers may not seem like “real estate”, but they are both critical pieces of modern infrastructure that take up land.
REITs that focus on these sectors include American Tower and Crown Castle, which own wireless communications assets in the U.S. and abroad. They are likely to benefit from the increased adoption of 5G networks and the Internet of Things (IoT).
On the other hand, Equinix and Digital Realty are focused on data centers, a fast growing industry that is benefitting from digitalization. Both of these REITs work with major tech firms such as Amazon and Google.
Trends to Watch
The demand for real estate can be heavily influenced by overarching trends found around the world. One of these is population growth and urbanization, which has drastically pushed up the cost of housing in many cities around the world.
There’s also the rising prevalence of ecommerce, which has triggered a boom in demand for warehouse space. This is best captured by Amazon’s massive growth during the COVID-19 pandemic, during which the company doubled the number of its warehouse facilities.
Globally, ecommerce accounts for just 19.6% of total retail sales. Should that figure continue to rise, industrial real estate prices could be in store for robust, long-term growth.
Pandemic Recovery: Have North American Downtowns Bounced Back?
All North American downtowns are facing a sluggish recovery, but some are still seeing more than 80% less foot traffic than pre-pandemic times
Pandemic Recovery: Have Downtowns Bounced Back?
As we continue on our journey towards recovery from the impacts of the pandemic, North American offices that sat empty for months have started to welcome back in-person workers.
This small step towards normalcy has sparked questions around the future of office life—will office culture eventually bounce back to pre-pandemic levels, or is remote work here to stay?
It’s impossible to predict the future, but one way to gauge the current state of office life is by looking at foot traffic across city centers in North America. This graphic measures just that, using data from Avison Young.
Change in Downtown Office Traffic
According to the data, which measures foot traffic in major office buildings in 23 different metropolitan hubs across North America, remains drastically below pre-pandemic levels.
Across all major cities included in the index, average weekday visitor volume has fallen by 73.7% since the early months of 2020. Here’s a look at each individual city’s change in foot traffic, from March 2, 2020 to Oct 11, 2021:
|City||Country||Change in Foot Traffic|
|San Francisco Peninsula||🇺🇸||-70.00%|
The Canadian city of Calgary is a somewhat unique case. On one hand, foot traffic has bounced back stronger than many other downtowns across North America. On the other hand, the city has one of the highest commercial vacancy rates in North America, and there are existential questions about what comes next for the city.
Interestingly, a number of cities with a high proportion of tech jobs, such as Austin, Boston, and San Francisco bounced back the strongest post-pandemic. Of course, there is one noteworthy exception to that rule.
A Tale of Two Cities
Silicon Valley has experienced one of the most significant drops in foot traffic, at -82.6%. Tech as an industry has seen one of the largest increases in remote work, as Bay Area workers look to escape high commuter traffic and high living expenses. A recent survey found that 53% of tech workers in the region said they are considering moving, with housing costs being the primary reason most respondents cited.
Meanwhile, in a very different part of North America, another city is experienced a sluggish rebound in foot traffic, but for very different reasons. Ottawa, Canada’s capital, is facing empty streets and struggling small businesses that rely on the droves of government workers that used to commute to downtown offices. Unlike Silicon Valley, where tech workers are taking advantage of flexible work options, many federal workers in Ottawa are still working from home without a clear plan on returning to the workplace.
It’s also worth noting that these two cities are home to a lot of single-occupant office buildings, which is a focus of this data set.
Some Businesses Remain Hopeful
Despite a slow return to office life, some employers are snapping up commercial office space in preparation for a potential mass return to the office.
Back in March 2021, Google announced it was planning to spend over $7 billion on U.S. office space and data centers. The tech giant held true to its promise—in September, Google purchased a Manhattan commercial building for $2.1 billion.
Other tech companies like Alphabet and Facebook have also been growing their office spaces throughout the pandemic. In August 2021, Amazon leased new office space in six major U.S. cities, and in September 2020, Facebook bought a 400,000 square foot complex in Bellevue, Washington.
Will More Employees Return or Stay Remote?
It’s important to note that we’re still in the midst of pandemic recovery, which means the jury’s still out on what our post-pandemic world will look like.
Will different cities and industries eventually recover in different ways, or are we approaching the realities of “new normal” foot traffic in North American city centers?
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