The U.S. trade war with China is having a significant impact on the cost of building materials, as reported in a new study by Turner & Townsend.
New York City building contractors are adding between 5% to 10% onto the total construction costs due to tariffs on the prices of steel, aluminum, and other materials, according to the construction consulting firm. A cost study of a completed 90-story building at the Hudson Yards development showed that if the project was being built now, the cost of the core and shell construction alone would have increased by up to $150 million due to tariffs that are driving price increases on materials.
The company calculates that the cost difference of constructing some supertall buildings in New York could be up to $100 million for buildings with an overall cost of $1-1.5 billion.
Due to increased demand for domestic steel and recent reductions in production of steel made in China, the cost of domestic steel has risen an average of 22.4% over the last year. Turner & Townsend is warning owners that they should add up to a minimum of a 5% cost contingency on the total value of their core and shell steel framed buildings.
Owners should also consider early buyout packages and direct purchase of materials to lock in pricing on items such as steel and curtain wall as early as possible, the firm says.
Related Stories
Codes and Standards | Jul 26, 2021
Revamping of Florida building codes on the table after condo collapse
Tragedy could prompt upgrades like post-Hurricane Andrew effort.
Codes and Standards | Jul 21, 2021
Proposal to give Calif. hospitals more time for earthquake retrofits stirs controversy
State hospital association says 2030 deadline should be extended.
Codes and Standards | Jul 20, 2021
New York, New Jersey legislatures may revamp bidding rules to promote low-carbon concrete
Contractors would have to certify that their concrete is in compliance.
Codes and Standards | Jul 19, 2021
Lack of information on carbon emissions challenges construction industry
Reports recommends whole-life carbon assessments on building projects.
Codes and Standards | Jul 19, 2021
Florida condo collapse spurs increased scrutiny on inspections, regulations
Insurers demand proof of current inspections.
Codes and Standards | Jul 15, 2021
Three drywall code-referenced publications have been updated
Include guidance on fire resistance, sound control, application, and finishing.
Codes and Standards | Jul 14, 2021
Biden’s infrastructure proposal includes massive investment in school buildings
‘Once in a lifetime opportunity’ to upgrade HVAC and other key systems.
Codes and Standards | Jul 13, 2021
Reluctance to fund maintenance on older condos is a serious problem
Owner associations defer needed work, putting properties at risk.
Codes and Standards | Jul 12, 2021
Regulations on hydrofluorocarbons reduce roof insulation options
Canada, some U.S. states ban HFC blowing agents used in closed-cell foam.
Codes and Standards | Jul 8, 2021
New York City shuts down 322 construction sites for unsafe conditions
Action comes as inspectors visit more than 2,100 sites.