Source:ย Riderย Levettย Bucknallย
International property and construction consultancy firmย Riderย Levettย Bucknallย hasย released its newย Quarterly Cost Report for North America. With data current to April 1st, 2020 and featuring construction cost information for 14 US and Canadian markets, the QCR provides a statistical view of the state of the construction industry, detailing indicative construction costs for eight building sectors.โฏย
The impact of theย coronavirusย is seen in construction project shut-downs and pauses that marked the early phase of the pandemic, generating elevated unemployment numbers. Jobsiteย reopeningsย are encouraging, but as these projects wrap up, the business equation will shift: the construction backlog appears to be evaporating quicker than the pipeline is filling.ย ย
A Silver Lining?ย
While the immediate outlook is hazy, there is cause for longer-term optimism. โThe remote-working conditions caused by the pandemic forced companies to accelerate their adoption of digital processes,โ saidโฏJulian Anderson, FRICS, President ofย RLB North America. Looking ahead, Anderson sees this renewed focus on technology will drive the overall industry to become more efficient.โฏย
Market Highlightsโฏย
- RLB reports that from January 1st, 2020 to April 1st, 2020, the U.S. national average increase in construction costs was approximately 0.41 percent (1.64 percent annualized)ย
- Los Angeles (2.18 percent), Boston (1.26 percent), Seattle (1.00 percent), San Francisco (0.90 percent), Denver (0.59 percent), Phoenix (0.51 percent), and Las Vegas (0.42 percent) are the markets with cost increases above the national average during the second quarterย
- In Canada, Toronto tallied a Q2 construction cost index of 1.25 percent, while costs in Calgary rose to 0.60 percentย
Key Fiscal Barometersย
- Experiencing its first negative growth in six years, theย U.S. Gross Domestic Productย reported at -5.0 percent during Q1 2020ย
- Reflecting the pandemic, theย Architectural Billings Indexย is 33.1 points; a score below 50 indicates declining billingsโฏย
- The Canadian GDP sees its first negative growth in nearly four years, with a -2.11 percent change from Q4 2019โฏย