Construction Cost Index
(JANUARY 2009 = 100)
Nonresidential construction costs increased 2.2 percent year-over-year in Seattle and 2.1 percent nationally. Our Seattle index is 4 points higher than our national index.
(an indicator of future wage and activity trends)
Commercial construction employment in Seattle initially contracted sharply in response to the COVID-19 pandemic, but those losses have since moderated. The latest BLS statistics show a moderate 2% decline in year-over-year construction employment growth overall in 2020.
Building Component Trends
(Q4 2020 vs. Q3 2020)
• Fire Protection Systems (5.7%)
• Steel Framing/Stair Erection (5.4%)
• Reinforcing Steel Material (4.2%)
• Preformed Metal Wall Panels (3.7%)
• Entrances & Storefronts (3.5%)
• Deck Formwork (3.1%)
• Roofing System (2.8%)
• Site Concrete (2.2%)
• Steel/Metal Decking Material (2.2%)
• Steel Doors & Frames (1.8%)
• Site Utilities (1.8%)
• Electrical Systems
• Cast-In-Place Concrete
• HVAC Systems
• Plumbing Systems
• Floor & Wall Tile (-2.9%)
• Gypsum Board Systems (-2.6%)
• Flooring & Carpeting (-1.7%)
• Electric Traction Elevators (-1.4%)
• Asphalt Paving (-1.2%)
Note: All other components (14% of the index) increased 1%.
Costs increased for eleven building components in the Seattle index this past quarter, most notably for fire protection, steel framing/stair erection, and reinforcing steel material. Costs decreased for five components of the index.
Advice for Building Owners
Our Seattle construction cost index increased 2.2 percent overall in 2020. Downward pressure continues as some trade contractors and suppliers work to rebuild their backlogs. However, due to pandemic-related disruptions to supply chains we are seeing significant increases for PVC, steel, copper, lumber and glass. This, together with losses in productivity due to ongoing COVID-19-related procedures will offset much of the downward pressure in the market. We recommend planning for project costs to increase 3% in 2021.
About this report: The Mortenson Construction cost index is calculated quarterly by pricing a representative non-residential construction project in Seattle and other geographies throughout the country. Local employment figures are from the Bureau of Labor Statistics.
For a more specific update or questions regarding this report, please contact:
Director of Business Development