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 | Dec 10, 2019
Utilities rolling out more grid-interactive efficient building programs
Focus is on energy savings and demand flexibility.
Codes and Standards | Dec 9, 2019
Canada’s Zero Carbon Building Standard reports first 10 certifications
Projects include new and existing offices, schools, and warehouses.
Codes and Standards | Dec 6, 2019
New research examines flood mitigation policies in the U.S.
Thirteen states or cities have adopted effective measures; some restricting development in vulnerable areas.
Codes and Standards | Dec 5, 2019
USGBC unveils vision for LEED Positive
Roadmap will lay foundation for a future LEED that is regenerative.
Codes and Standards | Dec 5, 2019
Report shows reducing embodied carbon can save money and help mitigate climate change
Embodied carbon now accounts for 11% of global greenhouse gas emissions.
Codes and Standards | Dec 5, 2019
Dubai, London and New York are 2019’s ‘Construction Mega Cities’
From 2007 to 2025, GlobalData expects the cities’ combined gross domestic product (GDP) to increase by more than US$8 trillion to US$20.4 trillion.
Codes and Standards | Dec 2, 2019
New GBCI certification recognizes expertise in sustainability
Provides third-party verification of competency to ‘making the world more economically, socially, and environmentally sustainable.’
Codes and Standards | Dec 2, 2019
New tool allows users to learn how to reduce embodied carbon
Calculator delivers first digitized EPDs.
Codes and Standards | Dec 2, 2019
Trade group challenges St. Petersburg, Fla., ordinance on construction contract mandates
Legality of requirement to hire apprentices, disadvantaged workers at issue.
Building Owners | Dec 2, 2019
What building owners and AEC teams need to know about New York’s Climate Mobilization Act
On April 18, 2019, the New York City Council passed the Climate Mobilization Act, a suite of laws aimed to meet the city’s commitment to achieving carbon neutrality by 2050.