Coatings Industry News

Main News Page


Report Looks at 2020 Construction Cost Increases

Thursday, February 4, 2021

Comment | More

A new report from construction consultancy firm Rider Levett Bucknall has detailed how construction costs have changed across major cities in the United States.

For the most part, despite the COVID-19 pandemic, construction costs rose in the majority of cities from October 2019 to October 2020. The company’s comparative cost index looks at the bid cost of construction including labor, materials and overhead costs and fees, as well as applicable sales and use taxes.

The Data

The report cites the U.S. Department of Commerce, noting that in October 2020, construction put in place was estimated at a seasonally adjusted annual rate of $1.44 billion, which is 1.3% higher than the month before, and 3.7% higher than the same month in 2019.

4kodiak / Getty Images

A new report from construction consultancy firm Rider Levett Bucknall has detailed how construction costs have changed across major cities in the United States.

Rider honed in on 12 U.S. cities, finding increased comparative costs in all but one: Chicago’s construction costs went down by 1.29%. The other cities’ numbers included increases of:

  • Boston – 3.31%;
  • Denver – 1.83%;
  • Honolulu – 1.04%;
  • Las Vegas – 1.78%;
  • Los Angeles – 4.41%;
  • New York – 3.67%;
  • Phoenix – 1.43%;
  • Portland – 1.62%;
  • San Francisco – 3.82%;
  • Seattle – 2.39%; and
  • Washington, D.C. – .53%.

The report also broke down costs per square foot in eight categories in each city, including offices, retail shopping, hotels, hospital, industrial, parking, residential and education.

In correlation with employment and contract data for the year, residential construction costs saw some of the biggest year over year growth while industrial margins remained minimal. For example, the increases for single-family construction costs per square foot of gross floor area include:

  • Boston – from $260 to $360;
  • Chicago – from $220 to $420;
  • Denver – from $115 to $450;
  • Honolulu – from $295 to $785;
  • Las Vegas – from $100 to $350;
  • Los Angeles – from $205 to $365;
  • New York – from $300 to $600;
  • Phoenix – from $120 to $450;
  • Portland – from $155 to $325;
  • San Francisco – from $325 to $475;
  • Seattle – from $180 to $325; and
  • Washington – from $260 to $380.

Corresponding Stats

Recently released analysis from the Associated General Contractors of America at the end of last year saw an over increase in construction spending, which was propelled with double-digit increases in residential construction.

“Private nonresidential construction has declined for six months in a row, and the slide is accelerating,” said Ken Simonson, the association’s chief economist. “While some categories of public construction have held up so far, state and local budget problems are likely to drive a downturn in public project starts in the next few months.”

Construction spending in December totaled $1.49 trillion at a seasonally adjusted annual rate, which was an increase of 1% from November and 5.7% higher than in December 2019. However, the gains were limited to residential construction, which rose 3.1% for the month and 20.7% year-over-year. Meanwhile, nonresidential spending fell 0.8% from November and 4.8% year over year.

Other nonresidential spending numbers include:

  • power construction fell 10.8% year-over-year;
  • commercial construction slipped 1.4% year-over-year;
  • manufacturing construction tumbled 17.6% from a year;
  • office construction declined 3.3% year-over-year; and
  • healthcare construction fell 8.7% from the year before.

Some marginal increases were noted in other areas, however, including:

  • Public construction spending increased 3% year-over-year;
  • highway and street construction rose 3.9% from a year earlier; and
  • educational construction increased 4.5% year-over-year.

The big numbers, as what has been trending, were seen in private residential construction with an increase of 20.7% year over year. Single-family homebuilding rose 23.8% and multifamily construction climbed 17.8%.

The AGC is again calling for Congress and the new Biden administration to enact new recovery measures.

December Employment Numbers

While the spending statistics were just released, employment numbers for December were analyzed last month, with the group finding that construction employment as a whole increased by 51,000 jobs in December, with gains for both the residential and nonresidential industries.

The surveys also showed, however, growing pessimism for what 2021 will bring.

“December’s employment gains likely reflect milder weather than usual for the month rather than sustained demand for projects,” said Simonson at the time. “In fact, our survey found contractors expect the volume of work is likely to decline for nearly all nonresidential project types, and most firms have experienced project cancellations or postponements.”

Construction employment came in at 7.41 million in December, an increase of .7% over November. The number remains about 3% behind the most recent peak last February.

   

Tagged categories: Business matters; COVID-19; Economy; Good Technical Practice; Market; Market data; NA; North America

Comment Join the Conversation:

Sign in to our community to add your comments.


Advertisements
 
Abrasives Inc.

 
KTA-Tator, Inc. - Corporate Office

 
Axxiom Manufacturing

 
PaintSquare

 
Western Technology Inc.

 
HoldTight Solutions Inc.

 
Sauereisen, Inc.

 
CRW

 
 
 

Technology Publishing Co., 1501 Reedsdale Street, Suite 2008, Pittsburgh, PA 15233

TEL 1-412-431-8300  • FAX  1-412-431-5428  •  EMAIL webmaster@paintsquare.com


The Technology Publishing Network

PaintSquare the Journal of Protective Coatings & Linings Paint BidTracker

 
EXPLORE:      JPCL   |   PaintSquare News   |   Interact   |   Buying Guides   |   Webinars   |   Resources   |   Classifieds
REGISTER AND SUBSCRIBE:      Free PaintSquare Registration   |   Subscribe to JPCL   |   Subscribe to PaintSquare News
MORE:      About PaintSquare.com   |   Privacy Policy   |   Terms & Conditions   |   Support   |   Site Map   |   Search   |   Contact Us