Construction pricing pressure finally eases
A decline in commodity and materials costs has kept overall commercial building construction costs steady during the past three months, according to Turner Construction Co.'s Fourth Quarter 2008 Turner Building Cost Index. The fourth quarter index remained virtually unchanged from the Turner's third-quarter report. During the past year, construction costs have increased 4.91%.
“We have seen a global reduction in steel, copper, and aluminum prices,” said Karl F. Almstead, a Turner VP who oversees the quarterly report. “The drop in energy prices has also reduced industry cost pressure. In addition, the pace of construction starts has slowed and competition for small-scale projects has increased.”
However, what savings Building Teams are realizing on the commodity and materials side are being offset by rising labor costs.
The index is determined by several factors considered on a nationwide basis, including labor rates and productivity, material prices, and the competitive condition of the marketplace.