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Sydney tops construction costs list

 

Sydney remains the most expensive place for construction in Australia, but it’s still not as expensive as New Zealand.

Arcadis’ International Construction Costs 2024 report analyses global construction cost data to create a list of the world’s 100 most expensive cities to build in, with London, Geneva, Zurich, Munich and New York City topping the index.

In Australia, Sydney comes in at number 48 on the index, with Brisbane (51), Melbourne (54), Perth (62) and Adelaide (67) all making the top 100. Christchurch in New Zealand however is more expensive to build in, coming in at position 30 on the index, followed by Auckland at 46.

Compared to the previous year’s data, construction costs have fallen for Australian cities, which Arcadis says is due to a weaker Australian dollar.

Arcadis says that in 2024, construction-specific price inflation is forecast to continue to fall substantially in most construction markets, with stable and slowing price growth seen in both Auckland and Sydney in 2024 compared to 2023, though Brisbane is seeing a faster price growth this year compared to last year.

In Australia, data centres and industrial projects have been key standouts in terms of performance, Arcadis said.

“Looking forward, Australia has a significant pipeline of work across nearly all states – heavily skewed by the public sector and focusing on social infrastructure and transport, in addition to work on the 2032 Olympics and Paralympics in Queensland,” it said.

“However, capacity has fallen, with construction insolvencies now well above the long-term trend, leaving questions about how the strong forward workload pipeline can be delivered.

“There is growing movement towards low carbon design and construction, but in practice, these projects have only reached the feasibility and planning stages so far.

“In NSW, the newly-elected Minns government is doubling down on commitments to net zero by 2050 and providing significant investment into stimulating private sector participation into renewable energy – a trend which is likely to continue into 2024.

“It is also leveraging infrastructure projects to densify city development, with a growth in housing around new metro stations in Sydney likely to be a key feature in the next couple of years.

“Meanwhile, in Brisbane, infrastructure activity will ramp up as Olympic deadlines edge nearer.”

To download the report, visit: www.arcadis.com/en-au/knowledge-hub/perspectives/global/international-construction-costs-2024

 

 

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