Los Angeles Had Nation's Largest Increase In Construction Costs In 2017

Construction costs in Los Angeles rose 7.59% year over year, the largest increase among the nation's major markets, according to a report by property and construction consultancy firm Rider Levett Bucknall.

The increase in cost reflects the concerns of many local developers that high costs are the new norm as Los Angeles, from downtown to parts of greater Los Angeles, Orange County and Riverside are undergoing a building boom.

And with President Donald Trump’s plan to impose a steel and aluminum tariff, many developers are bracing for construction costs to continue to increase in the coming year.

“Our first quarter cost report is an empirical snapshot of the construction industry during a year when it was confronted by turbulence from proposed infrastructure programs, building-material tariffs, and immigration policies that impact labor pools,” Rider Levett Bucknall Global Board Chairman Julian Anderson said in a news release.

The Rider Levett Bucknall study released Monday found between Jan. 1 and Dec. 31, 2017, construction costs across the nation rose by 4.2%.

Los Angeles saw a rise in construction activity and had the highest increase at 7.59% from the previous year, followed by Portland with 6.05% and San Francisco at 6.23%, the study reports.

Boston, New York, Washington, D.C., Las Vegas and Denver experienced a little over 3% jump from the previous year. Phoenix's construction costs rose 4.31%, Seattle, 5.1% and Chicago’s increased by 5.35%.

Meanwhile, Honolulu saw a decrease in year-over-year construction costs of 1.74%.

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