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Dublin has been ranked the second-most-expensive city in the European Union to build in and the 19th-most-expensive city in the world, according to Turner & Townsend’s latest International Construction Market Survey.
It has been overtaken by Munich in terms of expense, with costs per SF averaging €316.70 and €323.50, respectively. But in spite of the high cost to build, Ireland is proving resilient, and construction is set to grow in 2023, according to the report's authors.
It put this down in part to relatively low labour costs, with construction wages in Dublin averaging €43.80 per hour. That figure stretches to €48.30 in London, €74.80 in Munich and €110.60 in Geneva.
From the survey of 89 global cities, the U.S. dominated the rankings of the most expensive places to build, with six U.S. cities in the top 10. New York is the most expensive market with an average build cost of €506.40 per SF, and San Francisco followed closely at €444.20.
Switzerland and Japan continue to be expensive countries in which to build. Geneva (€398.20) and Zurich (€397.40) were third and fourth, respectively, with Tokyo (€390.80) and Osaka (€384.10) ranking fifth and sixth. Hong Kong (€366.60) and London (€331.40) have dropped out of the top 10 ranking for the first time, overtaken by U.S. markets.
The data indicated falling sector confidence worldwide in the face of continued cost increases, fears of insufficient credit availability, and a persistent labour crisis, Turner & Townsend said. In all, 74.2% of global markets showed a skills shortage in the report.
It described the Dublin market as “warm” and predicted that the construction cost index would remain the same over the coming year.
“The construction industry in Europe and beyond faces headwinds on multiple fronts,” Turner & Townsend Managing Director Ireland Philip Matthews said in a statement. “Against a backdrop of rising costs of construction, higher interest rates, and market uncertainty, Ireland is proving more resilient than many of its counterparts.
“But this must not make us complacent. Clients need to keep close to supply chains and work with them to highlight and mitigate any risks as early as possible and ensure delivery pipelines can be met.”
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