Study Finds London, New York City Among Most Expensive Cities for Construction
Arcadis International Construction Costs index shows three U.S. cities among the top 10
Photo by shotbydave via Getty Images
London is the most expensive city for construction, according to the Arcadis 2024 International Construction Costs report released this month, with data collected in the first quarter of 2024. Three U.S. cities, New York, San Francisco and Philadelphia, are in the top 10 cities on the list, in fifth, sixth and seventh place, respectively.
The index is calculated using 20 building types, such as residential, commercial and public sector, taking into account construction costs and market conditions. Overall, interest rates, labor shortages and supply chain issues make for a “difficult year,” David Hudd, head of cost & commercial management, North America, said in a press release. “High borrowing costs [are] undercutting the positive impact of infrastructure investment in many countries,” he said. “Additionally, the increasing demand for labor, materials and power means that productivity is now becoming an increasingly critical factor in investment decisions and project viability.”
In the U.S., costs are being driven by growth in the manufacturing and technology sectors, including data centers and pharmaceutical facilities. “From a global perspective, the North America market has been seen as an attractive region for growth due, in part, to having a surplus of land that can allow for de-risking construction projects,” said Hudd.
Geneva, Zurich and Munich also rank among the most expensive cities to build, whereas Buenos Aires, Lagos and Johannesburg are among the least expensive, according to Arcadis.
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