Frances Bula with another excellent piece in the Globe, this time concerning cost increases in construction costs for Vancouver:
https://www.theglobeandmail.com/cana...sts-skyrocket/
Quote:
Construction costs rose more in Vancouver than in any other city in Canada during the past two years and were predicted to go up about 4 per cent this year, says a national tracking study.
The costs are increasing at a time when the province is on a massive drive to deliver big infrastructure projects, including two SkyTrain lines and a new Pattullo Bridge, along with thousands of units of low-cost housing.
Only Ottawa, a much smaller metropolitan region that is undergoing a surge of federal projects and private-sector tech startups, came close, according to Turner & Townsend, a company that does cost accounting and project management. It tracks about 300 projects annually in seven major cities.
Vancouver’s costs increased by 5.19 per cent in 2018 and 6.39 per cent in 2019, with slightly more than 4 per cent anticipated for 2020.
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Basically, costs for construction is rising at a rate faster than inflation, and a significant portion of the pressure is labour costs; there is a shortage of subtrades capable of delivering complex projects, at a time where construction activity is increasing, especially with the planned transit projects around the Lower Mainland.
On cost increases for housing, Bula notes the following:
Quote:
Between 2017 and 2018, the price of the lowest-cost construction – wood-frame buildings at the most affordable end – went up to $165 a square foot from $155 a square foot, a 6.5-per-cent increase.
More-expensive concrete towers increased in cost, at the higher end, to $315 a square foot from $280 a square foot – a 15-per-cent increase, according to estimates from Altus Group, a company that monitors commercial real estate.
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