Strong Level of Construction Activity across the United States Continues to Drive Increase in Construction Costs

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According to Turner Construction Company’s quarterly Building Cost Index, the busy construction market, the shortage of skilled labor, and the impact of natural disasters on material production and demand are putting upward pressure on construction costs

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We are seeing pricing for oil and PVC-related products increase, as production capabilities were impacted by hurricanes in the Southern United States. And, we are seeing a significant increase in demand for drywall in areas affected by the storms.

Turner Construction Company announced that the Fourth Quarter 2017 Turner Building Cost Index—which measures costs in the non-residential building construction market in the United States—has increased to a value of 1058. This represents a 1.34% quarterly increase from the Third Quarter 2017 and a 5.17% yearly increase from the Fourth Quarter 2016.

“We saw slight cost increases for select raw materials throughout the fourth quarter,” said Attilio Rivetti, the Turner Vice President responsible for compiling the Cost Index. “For example, despite steady glass prices, increases in aluminum pricing have translated to increased costs in curtainwall.”

Rivetti continued, “We are seeing pricing for oil and PVC-related products increase, as production capabilities were impacted by hurricanes in the Southern United States,” he said. “And, we are seeing a significant increase in demand for drywall in areas affected by the storms. These conditions are contributing to increased pricing and elongating lead times for select material.”

Turner has prepared the construction cost forecast for more than 80 years. The building costs and price trends tracked by the Turner Building Cost Index may or may not reflect regional conditions in any given quarter. The Cost 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. This index does not necessarily conform to other published indices because others do not generally take all of these factors into account.
About Turner Construction Company

Turner is a North America-based, international construction services company. Founded in 1902, Turner first made its mark on the industry pioneering the use of steel-reinforced concrete for general building, which enabled the company to deliver safer, stronger, and more efficient buildings to clients. The company continues to embrace emerging technologies and offers an increasingly diverse set of services. With an annual construction volume of $11 billion, Turner is the largest builder in the United States, ranking first in the major market segments of the building construction field, including healthcare, education, sports, commercial, and green building. The firm is a subsidiary of HOCHTIEF, one of the world’s leading international construction service providers. For more information please visit http://www.turnerconstruction.com.

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Christopher McFadden
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Turner Construction Company
since: 03/2012
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