By BEX Staff for AZBEX
Mortenson has released its Q4 Construction Cost Index for seven major U.S. Markets. The Index rose 0.2% nationally and 1.2% for Phoenix. Nationally, costs increased 6.2% over the last 12 months, with Phoenix showing a much higher increase of 9.0%.
The report shows Phoenix had a total of 29,200 jobs in building construction in December, which marked an increase of 600 versus December 2021.
Regarding materials pricing, Mortenson reports that while costs are beginning to level out, challenges with long lead times, transportation logistics and materials shortages persist. As of Q4, Phoenix costs for PVC pipe were up 125%, steel pipe 72%, lumber 61% and reinforcing materials 42% versus Q4 2020.
In summarizing its findings, the report’s authors said: “The regional markets with an overall observed increase in Q4 include Denver (+0.07%); Seattle (+0.02%); Portland (+0.65%); Chicago (+0.3%); and Phoenix (+1.23%). Geographic markets showing slight decreases in Q4 included Minneapolis (-0.32%) and Milwaukee (-0.81%). The yearly percentage change in construction costs for 2022 averaged +6.7% across all markets tracked by Mortenson.
“Our construction cost index indicates that the increases experienced over the last two years are slowing. Based on market data and our insights, we remain cautiously optimistic while looking ahead to gauge further impacts from changes to the national economy and construction in 2023. We recommend customers maintain resiliency as we believe Q1 could provide greater clarity on industry direction for the remainder of the year.”