International property and construction consultancy firm Rider Levett Bucknall (RLB) has released its latest quarterly construction cost report for North America with data current to January 1, 2018 gathered from 14 cities across the United States and Canada, including Phoenix.
Julian Anderson, FRICS FAACE, President of RLB North America and Chairman of the Global Board, said, “Our first quarter cost report is an empirical snapshot of the construction industry during a year when it was confronted by turbulence from proposed infrastructure programs, building-material tariffs, and immigration policies that impact labor pools.”
Market highlights
• RLB reports that the U.S. national average increase in construction costs was 4.2%.
• Los Angeles (7.59%), Portland (6.05%), and San Francisco (6.23%) were the markets showing the greatest cost escalations
• Boston (3.16%), Chicago (5.35%), Denver (3.76%), Las Vegas (3.63%), New York City (3.29%), Phoenix (4.31%), Seattle (5.1%), and Washington D.C. (3.2%) experienced annual cost increases ranging from 3.2% to 5.4%. In Canada, Calgary (.34%) and Toronto (1.06%) saw smaller increases in costs
• Honolulu saw a decrease in year-over-year construction costs of -1.74%
• Over the course of 2017, construction activity in Honolulu, Portland, and Chicago held stable, while Boston, Denver, New York, Las Vegas, Los Angeles, Phoenix, San Francisco, Seattle, and Washington D.C. markets experienced an upturn in activity
Key fiscal barometers
• The U.S. Gross Domestic Product continues to fluctuate into 2018, closing out 2017 at 2.5%, down from 3.3% in Q3
• The Q4 spike in the Architectural Billing Index, up to 52.9 from 49.1, points to a robust year of billings in 2018
• Reflecting a tightening of the qualified labor market, the national average for construction unemployment dropped from 8.4% in Q1 2017 to 5.9% in Q4 2017
Read the complete QCR report here Q1-2018-QCR