International property and construction consultancy firm Rider Levett Bucknall (RLB) has released its latest Crane Index and Quarterly Cost Report. Together, the two documents provide a perspective on the North American construction industry in 14 key markets.
From the latest Crane Index Report, Toronto’s new crane count shows an 8% increase over Q1 2021, and an 81% increase since Q3 2020. Residential and mixed-use projects continue to dominate the market. Ongoing projects include the United Building Condos and a hotel, condominium, and retail tower – named The One – with 85 stories. Looking ahead, the Ontario government joins the U.S. in an effort to invest in infrastructure, announcing their investment on 38 infrastructure projects at an estimated $60B.
The slight drop in Calgary’s crane number reflects the completion of key healthcare projects. The multi-family sector remains steady in the city, with several buildings recently completed and new projects initiating construction. The transportation sector keeps pace with the construction of new roads and bridges; the $4.9 billion Green Line LRT project is the largest infrastructure project in Calgary’s history, RLB reports.
Crane Index notes
- Cities seeing an increase in cranes include Los Angeles, San Francisco, and Toronto
- Cities holding steady in their crane counts include Las Vegas and New York City
- Cities with a decrease in cranes include Boston, Calgary, Chicago, Denver, Honolulu, Portland, Phoenix, Seattle, and Washington D.C.
With data current to July 1, 2021, the latest RLB quarterly cost report shows that the U.S. national average increase in construction costs was approximately 1.51%. Boston, Los Angeles, Seattle, and Washington D.C. all experienced increases greater than the national average, while Chicago, Denver, Honolulu, Las Vegas, New York, Phoenix, Portland, and San Francisco saw less gains than the national average.
With materials prices continuing to increase and construction starts down across most sectors, the pressure is on contractors to bid competitively. “Since July 2020, contractor’s bid prices have grown 4.4%, while over the same period of time, the Producer Price Index has increased to 25.6%,” said Julian Anderson, FRICS, President of RLB North America. “This has significant implications for the construction business, as well as other AEC industries.”
Quarterly Cost Report notes
- The U.S. quarterly national average increase in construction cost is approximately 1.51%, compared to 0.16% year-over-year
- The construction unemployment rate drops to 7.5%, while the national unemployment rate dips to 5.9%
- The Architectural Billings Index (ABI) rises to 57.1