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What are the costs/benefits of Times Square?

04.05.13 | Eric | Comment?

By
Eric Schles, Zhangshuai Li, Daniel Padawer, Daniel Cohen, Benjamin Xie, Christopher G Williams, and David Iserovich

Setting the stage:
Today we asked the following question – What are the costs/benefits of times square? During this day of fun and hacking we learned about R, statistics, research methods, the city, what kind of data is out there, preprocessing and visualization. The team worked so well together there was even time for a group outing to artichoke! (Also hacking made us hungry.)

Methodology:

The first thing we had to do was define what is meant by “cost” and “benefit”.  The easiest definition for cost seemed to be power costs, water costs, and overall pollution abatement costs.  These lead us to search for the power consumption, water consumption and overall production of pollutants by the buildings in Times Square.  Benefits was harder to define.  We ended up settling on property values ( proxy by rental cost) , overall economic output, number of associated jobs, tax revenue, and “fiscal contributions” in overall city wide GDP.

Initially we considered either using a business or government perspective for this analysis.  However data was only available in such a way that we could look at the question from a mixed perspective.  Future studies may be interested in one way or the other.

There were also a number of questions we couldn’t get to, like how many taxi’s frequent times square and how much do they produce in terms of emissions?  Second, we would have liked to use the nyc open turnstyle data set to determine flows of foot traffic in and out of times square on a daily basis.  Third we would have wanted to create visualizations for the flow of electricity into New York City and see how that propagates to Times Square.  Sadly, there was not time.

Our results:

We define Times Square as the area of land between 42nd street and 48th street and between 8th avenue and 7th avenue.

-In .1% of NYC’s total land area, Times Square generates 11% of the city’s economic output and 10% of the city’s jobs.

-The district’s $110 billion in economic activity is up 22% since 2007, outpacing city growth of 9% during the same period.

-Annual direct spending on hotels, entertainment, and retail in Times Square is $4.8 billion.

-Broadway ticket sales tapped $1 billion in 2010; 83% of theatergoers came from out of town.

-Times Square – with 21% of NYC hotel rooms – added 2,000 rooms since 2007; direct hotel spending increased 13%.

-Times Square supports 385,000 jobs, 170,000 of which are within the district.

-Times Square has 29 million square feet of office space.

-In 2010, workers in and immediately around Times Square earned $18 billion in wages.

-These earnings are distributed throughout the city, with 61% of Times Square employees living outside Manhattan or north of 110th street.

-Times Square contributes 4.6 billion in New York State and New York City taxes each year.

-The district’s 2.1 billion fiscal contribution to New York City is enough to fund 46% of the NYPD budget or the Parks Dept. budget seven times over.

Source:

http://www.timessquarenyc.org/do-business-here/market-facts/economic-impact/index.aspx

Costs:

270 buildings in times square.

The total costs for each building are:

Average water cost: 3831576.47
Average electric cost: 13819243.26

Average ghg cost: 763733.77

data sources:

All metrics come from

http://www.nyc.gov/html/dof/html/pub/pub_reports_other_benchmarking.shtml

We took averages for all buildings and then found these point statistics. This data reflects 2012.

A bit of math:

So based on

270 buildings with total cost on average of 18414553.5 (the sum of the three costs). Thus we can guess total cost of running Times Square is 368,291,070 dollars per year in water, electricity and green house gas emissions

Given that the total gain from economic activity is 110 billion and total cost 368,291,070, the total net benefit is $109.6 billion dollars.

Criticisms regarding our results. (from the authors):

This was a fast a dirty study.  It is likely these estimates are under valued (in terms of costs).  We took a lot of point statistics, something you should never do in a thorough study.  Additionally, there was a lot of missing data that we had to interpolate, specifically in the water consumption costs.  Even so, it is likely that the total monetary gain from Times Square belays the costs captured here.  However, this does not mean we have captured all associated costs.  A good example might be to compare Boston to New York City.  Boston does not have Times Square however both are on the eastern seaboard and thus have similar power consumption needs.  If we looked at the overall, consumption of both cities throughout the year, it is at least the suspicion of one of our authors that we would find higher environmental costs.  Also, abatement costs are essentially are not perfect.  Even a marginal change in the cost per metric ton of Green House Gases (GHG) could translate to large cost differentials from proposed figures.  Thus the costs associated with Times Square may still be significant.

 

Not too bad for a project that was done in 5 hours also this was the first one of these, expect one every week.

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