Report: Most Expensive Cities for Construction
- Mar 09, 2017
New York—Building in the Big Apple will cost you big, according to a report by Arcadis. The global design and consultancy firm recently released its 2017 International Construction Costs report, and New York is holding onto its title of the most expensive city in the world for building.
In 2016, Arcadis advised that “forewarned is forearmed.” The firm identifies the theme for 2017 as “cost certainty in an uncertain world.” Edel Christie, global solutions leader, program management with Arcadis, noted in the report: “Risk can result in increased costs, and given construction’s poor record in improving productivity, there is a possibility that growing uncertainty might become a barrier to the successful delivery of project investment.”
Arcadis assessed 44 major cities across the globe, examining 13 building types and taking into consideration product quality, supply chain and cost differential factors. New York held its vice-like grip on the number-one position for another year. The city was followed on the cost comparison index by Hong Kong, which knocked exchange rate-hindered London down two spots from its 2016 position of the second most expensive market. Geneva ranked number three. In the U.S., Gotham’s price domination was glaring, with the city’s construction costs exceeding the national average by 50 percent, and surpassing costs in such leading cities as Boston and Los Angeles by 20 percent.
“Lack of real estate availability, accessibility issues and high real estate prices” are responsible for New York’s position so high up the list, David Hudd, cost and commercial director with Arcadis, said in a prepared statement. “To build in such a dense urban environment like New York City, you must find solutions to control costs, such as expertly handling storage, transport and staging of building materials, identifying skilled construction firms and labor far in advance, and implementing modularized construction.”
New York may be the priciest city for construction, but its ranking drops when it comes to big-ticket projects currently underway around the world. On Arcadis’s list of 10 of the highest value construction projects in 2017, One Belt, One Road—China’s a modern-day Silk Road initiative—comes out on top with a development budget of $150 billion. The Delhi Mumbai Industrial Corridor will cost $90 billion to complete, and Dubai’s Al Maktoum International Airport expansion project, which will make the facility the largest airport in the world, carries a development price tag of $33 billion. New York’s $20 billion Hudson Yards mixed-use project is the sixth most expensive construction undertaking in progress.
Images courtesy of Arcadis