Second Avenue Subway vs Madrid Metro: Why New York Pays Over Ten Times the Global Average per Mile

In June 2026 New York broke ground on the main construction stage of Second Avenue Subway Phase 2. It’s 1.8 miles of tunnel from 96th Street to 125th Street, with three new stations. The construction budget is about $6.9 billion, and the full cost with financing is about $7.7 billion. That works out at more than $4 billion a mile. The tunnel boring machine starts at 120th Street in early 2027, and trains are due in 2032.

Between 1995 and 1999, Madrid built 56 kilometres of metro and 37 stations for about $2.8 billion in today’s money. That’s roughly $50 million a kilometre, or about $80 million a mile.

These aren’t freak numbers picked to embarrass New York. The Transit Costs Project at NYU’s Marron Institute spent five years building a database of more than 900 rail projects in 59 countries. It found the global average is about $350 million a mile. Second Avenue Phase 2 is more than eleven times that. Phase 1, opened in 2017, cost $3.16 billion in hard costs for about 1.7 miles, eight to twelve times what comparable low-cost countries pay.

So where does the money go?

Bigger stations than the trains need

The single largest gap is in the stations. On Second Avenue, the 72nd and 86th Street station boxes are about 400 and 300 metres long for platforms of 187 metres. In France, Sweden and Italy, a station box is usually about 5% longer than its platform. The extra space in New York holds equipment rooms, crew facilities and back-of-house areas that other systems fit into a fraction of the room. Each extra metre is dug out of Manhattan bedrock.

Labour, consultants and paperwork

Labour makes up 40% to 60% of hard costs on projects in New York and the US Northeast. In Turkey, Italy and Sweden it’s 19% to 30%. Part of that is staffing: a tunnel boring shift on Second Avenue ran with 46 workers where about 30 would have done.

Soft costs, the design, management and consulting around the build, came to 21% of construction costs on Second Avenue. The comparison projects ran 5% to 10%. Phase 1’s design and management consultants cost $656 million. For Phase 2, the MTA approved about $250 million more in consultant contracts.

Behind that sits a habit. American agencies tend to hire consultants to design and supervise, because they’ve lost the in-house engineers who used to do it. Milan has had its own engineering company, MM, since 1955. Madrid’s 1990s expansion was run by a small in-house team.

How Madrid did it

Madrid’s programme, led by engineer Manuel Melis, followed a few plain rules. Use standard station designs and copy them. Run eight tunnel boring machines around the clock. Award contracts on a lump-sum basis, with price counting for only 30% of the score so firms didn’t lowball and claw it back later. Keep design decisions inside the public agency.

The Transit Costs Project found the same pattern elsewhere. Italy averages about $120 million a kilometre across 50 metro projects. Istanbul’s M4 extension came in at about $73 million a kilometre. Turkey also caps cost increases at 20% of the contract value, which forces realistic bids.

What it means for policy

The lesson the researchers draw is about institutions: how an agency is staffed and how it buys matters more than what lies under the street. A government that keeps engineering skills in-house, standardises designs and owns its decisions builds cheaply. One that outsources the thinking pays for it many times over.

They also found little evidence that handing risk to private partners lowers costs, looking at England, Singapore, Hong Kong and Canada.

The same questions hang over Britain’s HS2 and California’s high-speed rail, two projects that show the problem at national scale. For New York the cost is concrete. At Second Avenue prices, the money for three stations in Harlem would have built most of a city’s metro line in Spain.