International property and construction consultancy firm, Rider Levett Bucknall (RLB), has released its latest Quarterly Cost Report (QCR) for North America. With data current to January 1, 2019 and featuring construction cost information on 14 markets, it provides a statistical view of the state of the construction industry.
Upon publication of the QCR, Julian Anderson, FRICS, FAACE, President of RLB North America, said, “According to our report, there are many markets currently at or near the top of the construction-activity cycle. Denver, Portland, Phoenix, Toronto, and Seattle are peaking, with Los Angeles, New York, Boston, San Francisco, and Las Vegas at the threshold of that zone.”
Sector survey: The report also takes a look at indicative construction costs for 15 building typologies in each market, citing the high/low hard costs per square foot in eight major sectors. This data can form the basis of compelling comparisons of cost across regions and/or sectors. Sectors surveyed include housing (multi-family and single-family), retail (strip and central configurations), office (prime and secondary), hospitality (three- and five-star hotels), hospitals, warehousing, parking (ground level and basement facilities), and the full range of education projects, from kindergarten through college.
• RLB reports that from January 1, 2018 to December 31, 2018, U.S. national average increase in construction costs was approximately 5.73%
• Chicago (7.61%), Portland (7.13%), San Francisco (6.73%), Phoenix (6.70%), Washington DC (6.51%), and Seattle (6.48%) are the markets that showed the greatest annual cost escalations
• Las Vegas (5.41%), Honolulu (4.86%), New York (4.54%), Boston (4.42%), Los Angeles (4.40%), and Denver (4.02%) experienced below-average annual cost increases
• In Canada, construction costs significantly increased year over year. Construction costs in Calgary increased 7.29% and Toronto’s increase was 9.47%
Key fiscal barometers
• The U.S. Gross Domestic Product closed out 2018 at 2.6%, down from the mid-year peak of 4.2%
• At 50.4, the Architectural Billings Index remains in positive territory while indicating a slight decline in growth for architectural firms
• Following the cyclical trend of higher unemployment rates in the construction industry during the winter season, construction unemployment stands at 5.1%
Read the complete QCR report here.