The global recession’s vise grip on construction costs is starting to loesen in several countries, according to the London-based international project and cost-management firm Gardiner & Theobald Inc. The nineteenth annual survey of costs is conducted exclusively for Engineering News-Record. G&T surveys its 51 offices and affiliates worldwide. Related Links: Forecast: A Weak Recovery Checks Inflation Confidence Index: Heads of Major Firms Believe Market Is Nearing Stability Equipment: Why Few Are Debating the New Federal Fuel Economy Rules Lumber: Chinese Demand Props Up Prices Asia: Overseas, Inflation Creeps Back Complete Report Of the 28 countries reporting building cost inflation through
The tax breaks that fill the $858-billion Middle Class Tax Relief Act will provide welcome benefits for construction workers, some small firms, family-owned businesses and companies mulling equipment purchases. But the key question for the still-struggling construction industry is whether the measure’s incentives, including an extension of 2001 and 2003 tax-rate reductions, will hoist the economy enough to get more projects under way. If that “trickle up” effect does come to pass, it could give construction markets a boost, but probably not a sharp spike and probably not right away. Photo: Ap Images/J. Scott Applewhite Nevertheless, industry economists and financial
No more federal stimulus money, no highway bill, a weak economic recovery, a stalled housing market, a nonresidential building market yet to bottom out, gridlock in government, continued high unemployment—it could add up to no inflation in 2011. That is about as simple as a cost forecast can be. Inflation? Not so much. Engineering News-Record expects its Building Cost Index to increase just 1.3% next year after rising 3.6% in a difficult 2010 market. ENR projects its Construction Cost Index to increase 2.0% in 2011 following this year’s 3.6% gain. Related Links: Confidence Index: Heads of Major Firms Believe Market
The global recession knocked down building costs in many Asian countries in 2009, but inflation appears to be making a modest comeback in the region this year. The London-based international cost consultant Gardiner & Theobald Inc. reports that building costs in Shanghai declined 3.4% in 2009 after increasing about 7% in both 2007 and 2008. This year, building costs in Shanghai increased 1.4%, says G&T. + Image Related Links: Forecast: A Weak Recovery Checks Inflation Confidence Index: Heads of Major Firms Believe Market Is Nearing Stability Equipment: Why Few Are Debating the New Federal Fuel Economy Rules Lumber: Chinese Demand
Contractors on the West Coast may be scratching their heads, asking why lumber prices are rising when they are falling every where else. The answer is China. The Chinese have more than doubled their purchases of lumber from Canada and the U.S. within the last year, according to industry specialist Random Lengths, Eugene, Ore. That demand drives a price disparity in the Pacific Northwest, especially for spruce products, and prices in the rest of the country. Related Links: Forecast: A Weak Recovery Checks Inflation Confidence Index: Heads of Major Firms Believe Market Is Nearing Stability Equipment: Why Few Are Debating
Maybe it is the gains on Wall Street. Maybe it is the recent midterm elections. Maybe it is the general optimism of the construction industry at work. Whatever the reason, major contractors, design firms and subcontractors are feeling decidedly less pessimistic about construction market prospects than they did just three months ago, according to the ENR Construction Industry Confidence Index survey for the fourth quarter of 2010. + Image Related Links: Forecast: A Weak Recovery Checks Inflation Equipment: Why Few Are Debating the New Federal Fuel Economy Rules Lumber: Chinese Demand Props Up Prices International: Recession Relinquishes Grip On Global
Related Links: Manufacturers Are More Upbeat About Sales But Don�t Expect Full Turnaround Until 2012 Construction equipment producers are expected to boost sales by 6.4% this year after steep declines of 30% to 50% last year. “While this rebound is welcome … there is a long way to go,” says Dennis Slater, president of the Milwaukee-based Association of Equipment Manufacturers. AEM upped its previous 2010 forecast of 5% in its latest member survey. The U.S. trucking-and-hauling category is expected to make the largest 2010 gains, at 26.8%, while cranes and lifting is predicted to have the worst results—an 11.5% decline.
Getting stakeholders to agree on a clean-air rule is no easy feat. So it may come as a surprise that the equipment industry is getting behind new federal greenhouse-gas targets for big trucks. Photo: Mike Larson Improved fuel efficiency will help defray the cost of meeting new environmental standards. Related Links: Forecast: A Weak Recovery Checks Inflation Confidence Index: Heads of Major Firms Believe Market Is Nearing Stability Lumber: Chinese Demand Props Up Prices International: Recession Relinquishes Grip On Global Construction Costs Asia: Overseas, Inflation Creeps Back Complete Report One reason for the lack of debate is economics. “The new,
This year was better than 2009 for the companies that design, equip and build major projects for the worldwide oil and natural-gas industry, and all indications are that 2011 will bring further improvement, though the boom times of a few years ago have yet to return. Photo: Courtesy of KBR KBR is providing design and procurement for a deepwater offshore facility in the Caspian Sea. Related Links: Overview: Finding Work in Tough Times View Complete Global Sourcebook with Rankings General Building: Firms Say World Market Is Thawing, Albeit Slowly Transportation: Asia Bright Light in Otherwise Dim Sector Power: Growing Demand
Australia’s largest-ever privately financed transportation infrastructure project appears to be running on schedule. But two years into its construction, Brisbane’s $4.6-billion Airport Link highway is taking a financial toll on the project’s design-build team. The 6.7-kilometer toll road is being built to link central Brisbane to its northern suburbs and airport district. The project includes twin 5.7-km-long tunnels set some 20 meters apart. With more than $2.5 billion spent to date, the project is more than 60% complete, reports Raymond Wilson, chief executive of the road’s concessionaire, Brisconnections. “The pace of tunnel excavation is quickening. We have seen four tunnel
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