Almost 8 In 10 Global Real Estate Markets Struggling To Find Enough Construction Workers
More than three-quarters of cities globally are struggling to attract enough workers to meet the demand for new buildings, a major new construction survey has found.
The latest international construction market survey by consultant Turner & Townsend found of 88 markets globally, 80% of those studied were struggling to deliver enough workers to meet demand for real estate, with almost 4 in 10 considered 'hot' or 'overheating'.
American cities dominate the overall rankings this year for the most expensive places in the world for real estate development, as overheating markets threaten to curtail burgeoning pipelines post-pandemic. San Francisco was named the world’s most expensive market at an average cost of $438 per SF.
The rising cost of construction, long lead times and skilled labour shortages were rated as the most significant issues. A total of 17% of markets were found to have suffered a “significant impact” from supply chain disruption, with a further 40% noting a high impact during the past 12 months.
The cost of building in Dublin has risen by 8%, with the city considered the 15th most expensive place in the world to build, the report found.
In a year when Ireland was one of Europe’s best-performing economies, Dublin has been ranked the fourth most expensive among its European neighbours after Geneva (No. 5), Zurich (No. 6) and London (No. 10).
Average costs to build in Dublin stood at €291 per SF, down three places internationally from 12th place the previous year.
The Irish capital has been overtaken by U.S. cities including Nashville, Seattle and Chicago, in part due to the strength of the U.S. dollar over recent months, which has made construction relatively more expensive in U.S. cities than their international counterparts.
“Against a backdrop of rising inflation across the eurozone and the bloc grappling with the challenge of material disruption and rising energy costs caused by the war in Ukraine, Ireland is proving more resilient than many markets,” Turner & Townsend Managing Director, Ireland Mark Kelly said.
“As one of Europe’s best-performing economies, Ireland is expecting to see construction cost inflation soften faster than many of its neighbours but we cannot be complacent. Inflation remains historically high, and the continued interconnectivity of international markets is clearer now than ever.”