SEATTLE – (February 12, 2018) – Mortenson Construction released today its quarterly Construction Cost Index for Seattle. According to the report, the Seattle market’s construction costs in Q4 of 2017 continue to increase while employment growth has leveled out, which may alleviate pressure on construction wage growth moving forward.
Construction costs for non-residential construction labor, material, and equipment in Seattle increased by 3.8 percent since the fourth quarter of 2016. According to the Bureau of Labor Statistics, Seattle-area construction employment growth has slowed relative to 2016.
Mortenson recommends that building owners anticipate cost increases between 3.5 and 4 percent for 2018.
After far outpacing national averages in 2015 and 2016, Seattle’s cost index mirrored the national average in 2017.
“While Seattle’s construction crane count dropped 22 percent in January, the city still has more cranes than any other major city in the nation,” said Mark Wagner, chief estimator at Mortenson. “We predict the arrival of more cranes in Seattle starting late spring 2018 with additional projects slated to start in spring 2019.”
Building materials and components in Seattle experiencing the highest cost increases in the fourth quarter of 2017 (as compared to Q3 2017) included metal wall panels, steel doors/frames, steel framing/stairs, structural steel/decking, HVAC systems, and painting/wall covering. While wood doors, plumbing systems and electrical systems have experienced a decrease in cost. All other categories experienced slight growth or remained flat.
Mortenson tracks and reports on six metropolitan areas in the U.S. including Minneapolis, Milwaukee, Chicago, Denver, Phoenix, and Seattle. The Mortenson Construction Cost Index is calculated quarterly by pricing a representative non-residential construction projects in various metropolitan areas. It is part of a portfolio of industry insights and market studies provided by Mortenson. The Construction Cost Index is available for download at www.mortenson.com/cost-index.
Since 1982, Mortenson Construction has provided diversified construction services offering customer-centric general contracting, construction management, design-build, program management, project development, and “turn-key” development in Seattle. Mortenson has built over 250 projects valued at more than $4 billion. Clients include: Alaska Airlines, Boeing, City of Seattle, City of Tacoma, Group Health, Microsoft, Providence Hospital, Snohomish County, Tulalip Tribes, the University of Washington, among others. For more information, please visit www.mortenson.com.