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
| Oct 28, 2011
Los Angeles County mulling building codes for improving health
An ordinance would amend county building codes to promote better walking environments, encourage more bicycling, improve access to healthy foods (farmers markets, community gardens), and enhance project review requirements to ensure that developers include healthy-lifestyle components in their building plans.
| Oct 28, 2011
Bipartisan opposition to federal 3% withholding for contractors
Both major political parties and the Obama Administration support repealing a law that would withhold 3% of all government contracts.
| Oct 28, 2011
OSHA requires training module on top causes of construction deaths
The Occupational Health and Safety Administration (OSHA) now requires a training module on the top four causes of death for construction workers.
| Oct 28, 2011
New York City requiring building energy use to be posted online
Owners of every New York City commercial and residential building larger than 50,000 sf will have to post each building’s energy use online by 2013.
| Oct 28, 2011
New ISO standard for escalator safety
A new ISO standard specifies safety requirements for escalators and moving walks.
| Oct 20, 2011
LEED 2012 to require real-time energy, water use reporting
The LEED 2012 rating system, set to launch in November 2012, will contain features to make sure buildings function as intended, and improve over time.
| Oct 20, 2011
New York City moving to speedier, online design reviews
New York City is moving towards a development design review process that will let officials and developers review blueprints for new projects online in a virtual conference room rather than in person.
| Oct 20, 2011
Michigan bill would let private firms operate as a city’s building department
Michigan House Bill 5011 would change state’s building code to allow private companies to operate as a municipality's building department.
| Oct 20, 2011
Alabama’s strict immigration law drives away construction workers
Alabama's strict new immigration law is driving many construction workers and roofers from the state.
| Oct 20, 2011
Fed bill would allow school rehab funding via historic tax credits
Virginia Sens. Jim Webb (D) and Mark Warner (D) introduced a bill this month to rehab aging schools across the country through the use of historic tax credits.
