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1、CONSTRUCTION MARKET INTELLIGENCEINTERNATIONAL REPORTFOURTH QUARTER 2022Rider Levett Bucknall|International Report Fourth Quarter 20222As the largest independent and most geographically prevalent construction cost consultancy of its kind in the world,Rider Levett Bucknall(RLB)has access to the foremo

2、st construction market intelligence.RLB collects and collates construction data and forecast trendson a global,regional,country,city and sector basisfrom its comprehensive network of offices around the globe.The RLB International Report,which is published half-yearly,presents a snapshot of this data

3、.RLB publishes key industry intelligence data throughout the year.For more detailed sector,city,country and regional data,please review our regional or country specific publications.These can be found under the Insights tab of RLB.com.INDEPENDENT CONSULTANTS,LOCAL KNOWLEDGE AND EXPERTISE,GLOBAL NETW

4、ORKCover Image:Aerial view of the Art Gallery of New South Wales new SANAA-designed building,2022,photo Iwan BaanEach RLB office contributes to the global intelligence,providing insights into the conditions and trends that impact the local construction industry.The information gathered and dissemina

5、ted by each office includes:RLB Crane Index Forecast Tender Price Index uplifts RLB Construction Market Activity Cycle Key building type cost ranges in local currenciesTENDER PRICE INDEXRLBs Tender Price Index(TPI)showcases the historical and forecast movements in construction cost inflation and esc

6、alation on an annual basis.The TPI annual rate represents an overall forecast of the movement of construction costs for the industry within the key cities of RLBs network of offices.BUILDING COST RANGESRLBs regularly updated Building Cost Ranges can be found via the RLB website( regions Cost Intelli

7、gence publication features current building cost ranges,and each publication can be found on under the Insights tab.CONSTRUCTION MARKET INTELLIGENCEA summary of Construction Market Intelligence is provided by each region,highlighting the issues that are impacting the construction industry,and provid

8、ing key insights into current construction price movements.RLB MARKET ACTIVITY CYCLEThe RLB Market Activity Cycle focuses on seven key sectors within the overall construction economy.Local RLB Directors assess the current position of each sector within the market activity cycle for each respective c

9、ity.RELATIVITY INDEXUsing TPI data and cost modelling,RLB provides a general cost comparison for building costs between locations.The Relativity Index ranks each city in respect of other locations within the RLB network of offices.Currently,49 cities are included in the index.RLB CRANE INDEXThe RLB

10、Crane Index provides a simplified measure of the current state of the construction industrys workload in key locations around the world.RLB offices record fixed crane numbers across key cities by project sector,which provides an overview of how markets change over time.Rider Levett Bucknall|Internat

11、ional Report Fourth Quarter 20223TABLE OF CONTENTSExecutive Summary4Regional Construction Industry Influences on Escalation6Global Market Sector Activity7RLB Tender Price Index9RLB Crane Index11Global Construction Cost Relativity Index12Regional IntelligenceAfrica14Middle East16North Asia18South Asi

12、a20North America22Australia24New Zealand26United Kingdom28Mainland Europe29Each coloured region represents a section within the Regional Intelligence pages of this report.Rider Levett Bucknall|International Report Fourth Quarter 20224EXECUTIVE SUMMARYAlthough the global construction industry was imp

13、acted by government-imposed lockdowns during the COVID-19 pandemic,construction activity still expanded in 2020 and 2021;it was deemed essential in most countries.However,the global industry is now experiencing collateral damage caused by the pandemic.A global questionnaire facilitated by RLBs offic

14、es recently identified the major influences on regional construction inflation.Building material costs were pinpointed as the key driver in higher building costs across the globe.This is followed by availability of skilled labour and domestic interest rate rises.According to the survey results,68%of

15、 the key drivers causing pricing spikes across the globe are externally controlled.As such,these drivers cannot be effectively managed by domestic construction industries.The largest driver within the survey was material costs(27%)which has both internal and external forces controlling pricing in ea

16、ch region.Other disrupters to escalation include labour availability,interest rates,supply chain logistics,general inflation,wage cost increases,increases in government-led construction spending,local energy prices,and contract risk apportionment.A graphical representation of the major influences,bo

17、th external and internal,on regional construction escalation can be found on page 6.The global economy is facing significant challenges.Growth has lost momentum,high inflation has broadened out across countries and products,and is proving persistent.Risks are skewed to the downside.Energy supply sho

18、rtages could push prices higher.Interest rates increases,necessary to curb inflation,heighten financial vulnerabilities.According to Deloittes Economic Rebound Shaken by Crisis in Ukraine(published in March 2022),Russias invasion of the Ukraine has triggered turmoil within the global construction in

19、dustry.Although,these markets were already under some strain due to the flow on effects of the pandemic.The importance of Ukraine and Russia from an economic standpoint is demonstrated by the numbers:the two countries hold some of the largest iron reserves in the world and are consequently among the

20、 largest iron exporters.Economic damage from the conflict will contribute to a significant slowdown in global growth in 2022 and add to inflation.Geo-political conflicts accounted for less than 2%of RLB survey responses.However,the impact of this conflicts fuels other drivers,including material cost

21、 issues(27%of survey responses),supply chain logistics(7%),foreign exchange volatility(3%),and fuel prices(3%).According to The Business Research Companys Construction Global Market Report 2022,the global construction market is predicted to reach activity of$13.5 trillion($13,500 billion)in 2021,hav

22、ing increased at a compound annual growth rate(CAGR)of 4.6%since 2016.The industry is forecast to grow 9.8%from$13 trillion in 2021 to$23 trillion in 2026,and then to$39 trillion in 2031.Population growth in emerging countries,ageing populations in developed countries,greater urbanisation and concen

23、tration in megacities,the decarbonisation of the economy,and technology and digital transformations will be the main growth drivers for the industry in the coming decades.This is because all these factors will require significant investment in transport,water,waste management,social infrastructure,r

24、enewable energies,telecommunications,and adaptation to new technologies.According to Deloitte,it is estimated that only 20%of the global infrastructure needed for 2050 has been built.This global infrastructure gap represents a challenge for governments and for the construction industry.Almost two th

25、irds of the infrastructure investment forecasted for the next decade will centre on emerging countries,where infrastructure has a clear transformational impact on the lives of citizens and the development of businesses.However,even more developed countries will need to invest in infrastructure to im

26、prove competitiveness,meet increasing demand,sustain economic development,decarbonise the economy and digitalise.This need for significant social investment will add pressure to already limited resources within the industry(16%)and has already been identified as a major influence on construction pri

27、cing.Another key driver identified in the survey that will impact construction escalation is the rise in government sponsored spending(5%),particularly in the social and heavy infrastructure sector.Globally,most regions have seen a surge in construction inflation since RLB published the Q2 2022 Inte

28、rnational Report.All regions,except for North Asia,have seen rising construction inflation over the past six months.Adelaide(AUS)has recorded the largest increase over the past six months of an additional 7.8%to now forecast 12.5%for 2022.Conversely,with the zero COVID-19 policy still being adopted

29、in China,Shanghai has forecast a drop in escalation from 7.6%to a de-escalation rate of-4.4%in 2022.5,Interior view of the Art Gallery of New South Wales new SANAA-designed building,photo Iwan Baan,Sydney,AustraliaRider Levett Bucknall|International Report Fourth Quarter 20226RED=EXTERNALLY CONTROLL

30、ED BLUE=INTERNALLY CONTROLLEDMATERIAL COSTSLABOUR AVAILABILITYSUPPLY CHAIN LOGISTICSGENERAL INFLATIONWAGE COST INCREASESINCREASES IN GOVERNMENT LED CONSTRUCTION SPENDINGCONTRACT RISK APPOINTMENTCONTRACTOR/SUB CONTRACTOR SOLVENCYABNORMAL WEATHERINTEREST RATESFOREIGN EXCHANGELEGISLATION(CARBON SUSTAIN

31、ABILITY)GEO-POLITICAL CONFLICTPOWER PRICESFUEL PRICESTENDER VALIDITY PERIODINTERNAL POLITICAL INSTABILITYPOWER SUPPLY ISSUESBUILDERS MARGINCOVID-19REGIONAL CONSTRUCTION INDUSTRY INFLUENCES ON ESCALATIONRider Levett Bucknall|International Report Fourth Quarter 20227Since our Q2 2022 International Rep

32、ort was published,there has been a softening of sentiment across the consolidated responses of RLB and affiliate offices across the globe.With the current pressures on the global industry,the percentage of sectors within the growth phase of the cycle has dropped from 72%to 69%for this edition,with t

33、he largest fall within the housing sector.This indicates that while the housing is still strong across the globe,the market may have reached its peak.Currently,27%of all sectors are in the peak zone of the activity cycle,which is up from 26%six months ago.39%of sectors are in the mid zone,up from 36

34、%previously reported,and the trough zone represents 34%.The trend globally is that the development cycle has moved slightly upwards with more cities highlighting less sectors within the trough zone and growth in the mid and peak zones overall.Activity within the construction industry traditionally h

35、as been subject to volatile cyclical fluctuations.The RLB Market Activity Cycle(cycle)is a representation of the development activity cycle for the construction industry within the general economy.Within the general construction industry,RLB considers seven sectors to be representative of the indust

36、ry as a whole.These sectors are:houses,apartments,offices,industrial,retail,hotel and civil.Each sector is assessed as to which of the three zones(peak,mid and trough)best represents the current status of the sector within the cycle,then further refined by identifying whether the current status is i

37、n a growth phase or a decline phase.PEAK GROWTHPEAK DECLINEMID GROWTHMID DECLINETROUGH GROWTHTROUGH DECLINERLB MARKET SECTOR ACTIVITY CYCLE NUMBER OF GLOBAL SECTORS GLOBAL-MARKET SECTOR ACTIVITY NET SECTOR MOVEMENT FROM Q2 2022 TO Q4 2022 GLOBAL MARKET SECTOR ACTIVITYOUTER RING MARKET SECTORS AS AT

38、Q4 2022INNER RING MARKET SECTORS AS AT Q2 2022As previously identified within this report,all sectors are still seeing the impacts of long COVID.External influences on regional economies are having significant impacts on investment decisions,impacting activity going forward.Of the seven key sectors

39、on which each RLB office reports,the residential(houses and apartments),industrial and civil(infrastructure)sectors continue to record the strongest results,with activity remaining in the peak zone.With more than a third(34%)of all sectors within the trough zone,the medium and long-term challenges w

40、ithin the offices,retail and hotel sectors remain clear.The movement of 20 sectors from the growth phase of the cycle to the decline phase highlights the current pressures being felt within the global industry and a softening of the residential and hotel sectors globally.The movement for the last si

41、x months generally highlights a softening of global activity.The movement of sectors to the mid zone(in grey)from the peak zone(in red)highlight this softening.The residential sector saw the highest drop in the cycle with five cities indicating a softening of activity.Negative numbers represent fall

42、ing numbers of cities within the zone and rising numbers are reflected in the positive numbers.PEAK GROWTHPEAK DECLINEMID GROWTHMID DECLINETROUGH GROWTHTROUGH DECLINE19.4%7.7%21.9%27.1%3.6%28.2%8.9%10.9%21.2%22.8%15.7%12.6%8642-4-20HOUSESAPARTMENTSOFFICESINDUSTRIALRETAILHOTELCIVIL1322-14-20-10020103

43、0PEAK ZONEMID ZONETROUGH ZONERider Levett Bucknall|International Report Fourth Quarter 20228GLOBAL MARKET SECTOR ACTIVITYOverview The up and down arrows within the tables represent whether the sector is in a growth or decline phase,with the colour of the arrow determining the zone within the cycle.T

44、he three colours identified in the cycle diagram(red,grey and blue)represent the peak,mid and trough zones of the cycle.HOUSESAPARTMENTSOFFICESINDUSTRIALRETAILHOTELCIVILAFRICACAPE TOWN DURBANGABORONE(BOTSWANA)JOHANNESBURGMAPUTO(MOZAMBIQUE)MIDDLE EAST ABU DHABIDOHADUBAIRIYADHNORTH ASIA BEIJINGCHENGDU

45、GUANGZHOUHONG KONGMACAUSEOULSHANGHAISHENZHENSOUTHEAST ASIA HO CHI MINH CITYJAKARTAKUALA LUMPURSINGAPOREAMERICA BOSTONCHICAGODENVERHONOLULULAS VEGASLOS ANGELESNEW YORKPHOENIXPORTLANDSAN FRANCISCOSEATTLEWASHINGTON D.C.CANADACALGARYTORONTOHOUSESAPARTMENTSOFFICESINDUSTRIALRETAILHOTELCIVILAUSTRALIA ADELA

46、IDEBRISBANECANBERRADARWINGOLD COAST MELBOURNEPERTHSYDNEYTOWNSVILLENEW ZEALAND AUCKLANDCHRISTCHURCHWELLINGTONUNITED KINGDOMBIRMINGHAMBRISTOLLEEDSLONDONMANCHESTERSHEFFIELDTHAMES VALLEYRider Levett Bucknall|International Report Fourth Quarter 2022920212022(F)2023(F)2024(F)2025(F)2026(F)AFRICACAPE TOWN8

47、.29.46.06.2NPNPDURBAN7.78.05.1NPNPNPGABORONE3.19.06.1NPNPNPJOHANNESBURG4.25.06.0NPNPNPMIDDLE EAST ABU DHABI1.95.14.54.53.53.0DOHA2.95.24.93.93.2NPDUBAI1.95.14.54.53.53.0RIYADH3.010.48.27.44.83.8NORTH ASIA BEIJING5.0(2.5)2.02.02.02.0CHENGDU3.00.03.03.03.02.0GUANGZHOU5.92.02.03.03.03.0HONG KONG5.37.24

48、.04.04.04.0MACAU(2.0)0.52.02.02.02.0SEOUL14.09.69.18.47.77.2SHANGHAI7.6(4.4)3.03.03.03.0SHENZHEN5.00.01.02.03.03.0SOUTHEAST ASIA HO CHI MINH CITY8.84.65.15.14.64.6JAKARTA5.05.1NPNPNP NPKUALA LUMPUR6.13.04.0NPNP NPSINGAPORE10.08.85.03.03.03.0AMERICA BOSTON9.99.78.07.06.04.0CHICAGO9.610.03.04.05.04.5D

49、ENVER5.68.87.06.56.05.5HONOLULU4.04.76.07.05.04.5LAS VEGAS7.38.06.05.55.04.5LOS ANGELES8.07.25.04.04.04.5NEW YORK8.97.87.07.56.55.5PHOENIX8.68.95.53.53.54.0PORTLAND8.410.45.55.04.54.5SAN FRANCISCO7.25.75.04.84.55.0SEATTLE10.810.23.53.53.55.0WASHINGTON D.C.8.28.86.06.05.54.020212022(F)2023(F)2024(F)2

50、025(F)2026(F)CANADA CALGARY9.87.14.54.04.04.0TORONTO13.514.55.06.05.54.0AUSTRALIA ADELAIDE7.112.53.83.03.03.0BRISBANE9.610.55.15.15.15.1CANBERRA3.85.04.03.53.53.0DARWIN1.27.85.04.04.03.0GOLD COAST14.515.57.53.03.03.0MELBOURNE3.58.04.03.53.53.5PERTH13.59.45.64.43.63.0SYDNEY4.16.93.93.53.53.5TOWNSVILL

51、E10.412.68.04.03.03.0NEW ZEALAND AUCKLAND5.012.05.54.03.02.5CHRISTCHURCH8.59.05.04.03.02.5WELLINGTON6.09.05.04.03.03.0UNITED KINGDOMCARDIFFNP7.06.04.04.0NPBIRMINGHAM3.55.55.04.54.03.3BRISTOL3.54.03.02.52.3NPLEEDS3.28.53.03.53.5NPLONDON7.26.03.53.03.04.0MANCHESTER6.07.05.54.04.0NPSHEFFIELD3.28.53.03.

52、55.0NPTHAMES VALLEY3.85.03.52.52.5NPIRELAND&MAINLAND EUROPE BERLIN15.014.76.03.03.0NPBUDAPEST4.010.08.04.03.5NPOSLO6.08.14.62.62.4NPPRAGUE10.023.010.010.010.0NPRLB TENDER PRICE INDEXRLBs Tender Price Index(TPI)forecast percentage uplift ranges continue to highlight the volatility surrounding pricing

53、 and tender returns.RLB offices across the globe,apart from those in North Asian cities,are reporting tender submissions in which costs are higher than would have been expected in 2021.The spreads between the tenderers bids have widened,and there is a clear reluctance on the part of bidders to fix p

54、rices for any length of time.RLBs TPI forecast percentage uplift ranges depict not only a wide-ranging understanding of the bounds of the current price and cost problem but acknowledge the need to cope with contractor and subcontractor uncertainty over and above what has previously been the norm.Glo

55、bally,45%of RLB offices report 2022 escalation rates higher than those forecasted in the Q2 edition of this publication.The volatility is high.Thirty two percent recorded the same escalation rates and 23%forecast escalation rates for 2022 lower than those published previously.RLB continues to see sp

56、reads between the tenderers bids that are widening,and there is a clear reluctance on the part of bidders to fix prices for any length of time.Where prices are fixed,there are additional costs being applied within the tenders price for taking on the risk of pricing certainty.In the medium to long-te

57、rm,that uncertainty will dissipate.However,the short-term problem for pricing estimators is how to minimise cost volatility,without compromising winning work and maintaining a full workbook of suitable projects.Looking at the influences on regional escalation identified in the recent survey results,

58、external inputs are causing uncontrollable lifts in construction costs.The key global influences(both internal and external)are identified pictorially on the treemap on page 6.Running alongside this,RLB is advising clients on the most appropriate procurement solutions to assist in obtaining the most

59、 reasonable bid pricing.These procurement solutions are helping ensure the most appropriate management of risk,and minimising the underlying pricing uncertainties.RLB offices across the globe have highlighted the underlying global forces that are adding to local construction costs,in addition to the

60、 traditional local inputs that continue to affect construction pricing.10,Aerial view of the Art Gallery of New South Wales new SANAA-designed building,2022,photo Iwan Baan,Sydney,AustraliaRider Levett Bucknall|International Report Fourth Quarter 202211MIDDLE EAST CITIESQ4 2018Q4 2019MOVEMENT%CHANGE

61、DUBAI 1,193 1,345-ABU DHABI 338 257-DOHA 468 401-MIDDLE EASTERN CITIES 1,999 2,003-HONG KONG Q4 2021MOVEMENT%CHANGEHONG KONG ISLAND 37-KOWLOON 63-NEW TERRITORIES 82-HONG KONG CITIES 182-AFRICAN CITIESQ3 2021Q1 2022 Q3 2022 MOVEMENT%CHANGEDURBAN 21-6-71.4%CAPE TOWN 29-24-17.2%STELLENBOSCH 2-3 50.0%JO

62、HANNESBURG 20-23 15.0%PRETORIA 18-28 55.6%SOUTH AFRICAN CITIES 90-84-6.7%UNITED KINGDOM CITIESQ3 2021MOVEMENT%CHANGEBIRMINGHAM 21-BRISTOL-LEEDS 11-LIVERPOOL 6-LONDON 189-MANCHESTER 32-SHEFFIELD 10-UNITED KINGDOM CITIES 269-SOUTH ASIA Q3 2021Q1 2022 Q3 2022 MOVEMENT%CHANGESINGAPORE 466 520 500-3.8%JA

63、KARTA 74 49 37-24.5%HO CHI MINH CITY 120 122 118-3.3%KUALA LUMPUR 443 314 272-13.4%SOUTH ASIA CITIES 1,103 1,005 927-7.8%AMERICAN CITIESQ3 2021 Q1 2022 Q3 2022 MOVEMENT%CHANGE BOSTON 12 9 10 11.1%CHICAGO 7 10 18 80.0%DENVER 15 21 32 52.4%HONOLULU 6 6 9 50.0%LAS VEGAS 2 2 3 50.0%LOS ANGELES 51 51 46-

64、9.8%NEW YORK 10 12 14 16.7%PHOENIX 2 2 3 50.0%PORTLAND 15 12 15 25.0%SAN FRANCISCO 13 15 14-6.7%SEATTLE 39 37 42 13.5%WASHINGTON DC 35 26 26 0.0%UNITED STATES CITIES 207 203 232 14.3%CANADA CITIESQ3 2021 Q1 2022 Q3 2022 MOVEMENT%CHANGECALGARY 32 31 21-32.3%TORONTO 225 252 230-8.7%CANADIAN CITIES 257

65、 283 251-11.3%NORTH AMERICAN CITIES 464 486 483-0.6%NEW ZEALAND CITIESQ3 2021 Q1 2022 Q3 2022 MOVEMENT%CHANGEAUCKLAND 96 108 104 12.5%CHRISTCHURCH 14 12 10-14.3%DUNEDIN 1 1 5 0.0%HAMILTON 4 3 4-25.0%QUEENSTOWN 8 8 8 0.0%TAURANGA 5 3 5-40.0%WELLINGTON 16 15 12-6.3%NEW ZEALAND CITIES 144 150 148 4.2%A

66、USTRALIA CITIESQ3 2021Q1 2022 Q3 2022 MOVEMENT%CHANGEADELAIDE 11 16 17 6.3%BRISBANE 83 79 82 3.8%CANBERRA 33 31 23-25.8%CENTRAL COAST 10 10 10 0.0%DARWIN-2 2 0.0%GOLDCOAST 35 40 52 30.0%HOBART-2-MELBOURNE 180 192 206 7.3%NEWCASTLE 9 12 12 0.0%PERTH 37 55 51-7.3%SUNSHINE COAST 13 16 16 0.0%SYDNEY 295

67、 348 380 9.2%WOOLONGONG 12 12 15 25.0%AUSTRALIAN CITIES 718 813 868 6.8%RLB CRANE INDEXOVERVIEW In September 2012,the Rider Levett Bucknall Oceania Research and Development and communication teams created the RLB Crane Index as a simple insight into the construction sectors health in Australia.It wa

68、s based on the theory that cranes in the sky supported the construction industry,which is a significant contributor to Australias economic growth.The RLB Crane Index has now grown and is published biannually in Australia,New Zealand,North America,North Asia,South East Asia,Southern Africa,England an

69、d Europe,as well as annually in the Middle East.The Index currently tracks the number of cranes in 58 key cities within the RLB network of offices across the globe.It is anticipated that during the coming year further RLB and affiliate offices will be contributing crane numbers to extend the coverag

70、e across the globe.The RLB Crane Index provides a simplified measure of the current state of the construction industrys workload in each location.Each RLB office physically counts all fixed cranes on the citys skyline.Because of the geographic and topographical nature of each city counted,not all ar

71、eas counted are the same.The same area is counted within a city for each count,but the areas are different for each city.Globally,the trend for crane numbers in 2022 seems to be that crane activity has stabilized with the start of normality across the regions.Rider Levett Bucknall|International Repo

72、rt Fourth Quarter 202212REGIONPREVIOUS RANKINGCURRENT RANKINGCITYMOVEMENTPOSITIONMIDDLE EAST1519DOHA42431RIYADH73538DUBAI34041ABU DHABI1NORTH ASIA1922HONG KONG33940MACAU14342BEIJING14543GUANGZHOU24444SHENZHEN04245SHANGHAI3SOUTH ASIA3737SINGAPORE04746HO CHI MINH CITY14647KUALA LUMPUR14848JAKARTA0AUST

73、RALIA1717SYDNEY03820BRISBANE184121GOLD COAST202725MELBOURNE23226TOWNSVILLE62527PERTH23428ADELAIDE62230CANBERRA82935DARWIN6NEW ZEALAND2614AUCKLAND122123WELLINGTON23332CHRISTCHURCH1AMERICA22SAN FRANCISCO033NEW YORK044HONOLULU055BOSTON066CHICAGO078WASHINGTON D.C.189LOS ANGELES11312SEATTLE11818PORTLAND0

74、2329PHOENIX63034DENVER43136LAS VEGAS5UNITED KINGDOM910LONDON11415BRISTOL11616MANCHESTER02024BIRMINGHAM4EUROPE11OSLO0127BERLIN51111DUBLIN01013PARIS32833BUDAPEST53639MADRID3180160140100120806040999080717296616060608255534810099989392919090861059516013889159136136128126112100908786122101100941711351171

75、087688DOHARIYADHDUBAIABU DHABIHONG KONGMACAUBEIJINGGUANGZHOUSHENZHENSHANGHAISINGAPOREHO CHI MINH CITYKUALA LUMPURJAKARTASYDNEYBRISBANEGOLD COASTMELBOURNETOWNSVILLEPERTHADELAIDECANBERRADARWINAUCKLANDWELLINGTONCHRISTCHURCHSAN FRANCISCONEW YORKHONOLULUBOSTONCHICAGOWASHINGTON D.C.LOS ANGELESSEATTLEPORTL

76、ANDPHOENIXDENVERLAS VEGASLONDONBRISTOLMANCHESTERBIRMINGHAMOSLOBERLINDUBLINPARISBUDAPESTMADRIDRLBs Construction Cost Relativity Index identifies the relative cost of constructing similar buildings across the globe.The Index is based on the local costing of standard building models and baskets of good

77、s.These are costed globally,and within regions,using the same quantities and similar specifications.They are costed in local currencies and relativities are calculated using a combination of statistical methods,including:nConversion into one currency method by converting local currency model costs u

78、sing USD and the International Monetary Funds(IMF)published Purchasing Power Parity(PPP)nRLB developed EKS multilateral index nRLB Relativity Factor,a weighted sum of one currency results.The resultant index highlights the relativity in construction costs between key global cities as at Q2 2022.GLOB

79、AL CONSTRUCTION COST RELATIVITY INDEX 13Hasso Plattner School of Design-Cape Town,South AfricaRider Levett Bucknall|International Report Fourth Quarter 202214REGIONAL INTELLIGENCE11.4%17.1%11.4%11.4%5.7%2.9%31.4%45.7%0.0%28.6%34.3%CURRENT MARKET CONDITIONSActivity in Africas construction industry ha

80、s picked up over the last six months compared to that since the outbreak of the COVID-19 pandemic.COVID-19 waves and lockdowns definitely impacted construction activity.However,Africas construction industry was not completely shut down,apart from during the first hard lockdown where only stage three

81、 activities were permitted.Market activity in the Western Cape has seen a steep increase in the past 12 months.The Western Cape experienced much flatter COVID-19 impacts,because it is typically home to a larger number of small-to-medium projects,and fewer large-to-mega projects(which are particularl

82、y exposed to the impacts of COVID-19).As such,from a moderate base,the Western Cape region has seen a rapid increase in activity.The residential and industrial sectors experienced major activity increases.In contrast,with the need for office space substantially declining,the development of commercia

83、l buildings has taken a dive.Although the need for office space is low,some mixed-use developments(that incorporate a small volume of office space)continue.These mixed-use developments also encompass buildings with residential and strip retail spaces.For the foreseeable future it is expected that in

84、dustrial and residential developments will increase significantly,while commercial developments are expected to remain low.Some regional-specific factors have been experienced.For example,in Kwa Zulu Natal,last years riots led to the implementation of government funded programs that have increased c

85、onstruction activities,particularly in retail.It is envisaged that the recent floods in Kwa Zulu Natal will increase civil works dramatically to restore damaged infrastructure.CONSTRUCTION COST IMPACTLabour availability is not an issuethe unemployment rate is the highest that it has ever been since

86、comparable data began in 2008.However,material costs have seen an increase overall.General inflation continues to plays a role.It increased from 3.3%in 2020,to 4.5%in 2021.It is expected that general inflation in 2022 will average above 5%.As we know,South Africa is relatively dependent on global su

87、ppliers and is severely impacted by global issues.Supply chain and logistical challenges can be seen world-wide.Due to the conflict in Russia and the Ukraine,and with Russia being one of the largest oil providers in the world,consumables such as petrol and diesel are at an all-time high in South Afr

88、ica.This directly influences the rates received for bulk earthworks tenders due to the large proportion of plant usage in the contractors scope.Economic factors such as price increases in building materials and consumables will definitely impact the construction industry moving forward.Diesel prices

89、 have increased by 21%since the last reporting period and are expected to rise further.The Rand is very volatile and sensitive to fluctuations in the Pound,Euro and US Dollar.This volatility negatively affects the importation of building materials and equipment.As such,there has been a major shift i

90、n the use of locally manufactured product,such as tiles,reducing lead times as well as import costs.This increase in demand for locally manufactured products is causing other issues,with manufacturers not always meet demand and lead times becoming longer.Steel prices have also increased significantl

91、y.This influences all buildings constructed from reinforcement,copper,aluminium window frames,roof sheeting and so on.Although steel prices remain very high,RLB has started to see a decrease in steel prices in tenders.AFRICARLB TPI ANNUAL%MOVEMENTPEAK GROWTHMID DECLINEPEAK DECLINETROUGH GROWTHMID GR

92、OWTHTROUGH DECLINEOUTER RING-MARKET SECTORS AS AT Q4 2022INNER RING-MARKET SECTORS AS AT Q2 2022CURRENTPREVIOUSMOVEMENT202220232022202320222023CAPE TOWN9.46.0NPNPNPNPDURBAN8.05.114.86.6(6.8)(1.4)GABORONE9.06.14.1NP4.9NPJOHANNESBURG5.06.05.06.00.00.0PREVIOUS=FORECAST Q2 2022CURRENT=FORECAST Q4 2022MA

93、RKET SECTOR ACTIVITY 15Lusail City,QatarRider Levett Bucknall|International Report Fourth Quarter 202216REGIONAL INTELLIGENCEMIDDLE EASTRLB TPI ANNUAL%MOVEMENTCURRENT MARKET CONDITIONSIn the Middle East,COVID-19 pandemic restrictions have eased almost completely.As a result,tourism arrival numbers h

94、ave increased significantly from last year,particularly from Russia which is exceeding 2019 levels.Immigration from Russia is providing a boost to residential sales,particularly in the high end market.The luxury residential market is seeing record breaking sale prices for villas and apartments.Intro

95、duced in 2019,the Golden Visa a 10 year long-term residency that enables foreign nationals to live,work or study in the UAEis expected to spur investment.Tender activity is at its highest point since the COVID-19 pandemic,with significant increases in requests for proposals received.Feasibility of p

96、rojects is still under heavy pressure due to global uncertainty.The lag in feasibility for some projects is likely to continue,but it should lead to further increases in market activity.Higher energy prices are also directly impacting petrochemical driven economies.Some sectors remain buoyant,partic

97、ularly hospitality,tourism,travel,aviation and luxury residential.Tourism and retail activity are experiencing positive growth related to FIFA World Cup tourists visiting the United Arab Emirates(UAE).Positive signs continue to emerge around the Environmental,Social,and Governance(ESG)agenda and sus

98、tainability generally.Increasingly,there are initiatives to encourage growth in the green sector and developers are looking to achieve more sustainable outcomes from their developments.With the Dubai building portfolio now maturing,the demand and necessity for refurbishment,retrofitting and repurpos

99、ing within in the market is growing.This is being explored through life cycle costing studies,with a strong focus on efficiency gains and net zero carbon targets.Qatar is now in the midst of the FIFA World Cup,which has halted the majority of construction work.Activity preceding the Work Cup was lar

100、gely focused on tournament related projects,from infrastructure through to completion of hotels and entertainment venues.It remains to be seen what activity levels will be like once the World Cup is complete.It is likely to be significantly affected by the perceived success of the tournament.There m

101、ay be a six to 12 month lull as Qatar recalibrates and formulates an updated plan for the country.CONSTRUCTION COST IMPACTDemand for resources(human,capital and materials)from the Kingdom of Saudi Arabia(KSA)will continue to put pressure on supply for the UAE market.Fuel price increases will continu

102、e to contribute to general price inflation.Finally,increased costs in shipping and post COVID-19 delays will continue to impact material importation and the subsequent cost of sourcing alternatives.The stability of the UAE Dirhams means that it is a stable foreign exchange or forex trading investmen

103、t option within the region.With the Dirhams strengthening against emerging market currencies,this will help to reduce the import prices and mitigate global inflation.Contract risk apportionment remains imbalanced,with terms and conditions too highly favoring clients.The trend appears to be the impos

104、ition of even more stringent conditions.As competition increases from KSA,the UAE should be looking to make conditions more attractive.The continued focus of procurement departments on lowest cost and onerous tender and contractual bonds and requirements persists.This is impacting the quality and lo

105、ng-term value of developments.Although inflationary pressures have been seen in Qatar,costs have remained relatively stable in the last period.This is largely due to the majority of projects already in the construction phase,with new project commencements in the last period remaining fairly low due

106、to the World Cup.PEAK GROWTHMID DECLINEPEAK DECLINETROUGH GROWTHMID GROWTHTROUGH DECLINEOUTER RING-MARKET SECTORS AS AT Q4 2022INNER RING-MARKET SECTORS AS AT Q2 2022MARKET SECTOR ACTIVITY 11.4%17.1%11.4%11.4%5.7%2.9%31.4%45.7%0.0%28.6%34.3%CURRENTPREVIOUSMOVEMENT202220232022202320222023ABU DHABI5.1

107、4.55.14.50.00.0DOHA2.95.25.24.9(2.3)0.3DUBAI1.95.15.14.5(3.2)0.6RIYADH3.010.47.44.8(4.4)5.6PREVIOUS=FORECAST Q2 2022CURRENT=FORECAST Q4 202217Haikou International Duty Free Shopping Complex,Haikou,ChinaRider Levett Bucknall|International Report Fourth Quarter 202218REGIONAL INTELLIGENCENORTH ASIACON

108、STRUCTION COST IMPACTIn the first half of 2022,the prices of major materials in the construction industry in Shanghai decreased slightly compared to the fourth quarter of 2021.However,in the second quarter of 2022,investment in fixed assets and real estate in Shanghai has been slowing.While the hous

109、ing market is facing potential decline,construction of affordable housing under the government policy will help alleviate the market situation.In the third quarter of 2022,the average prices of steel,copper,aluminium and glass decreased compared with the first half of 2022.Wages of construction work

110、ers remained at a similar level during the same period.In Hong Kong,the construction costs in the first half of 2022 rose by 7.6%compared with the same period a year ago.Apart from inflated material costs,workers in 12 types of construction trades received pay rises starting from November 2022,after

111、 a three-year wage freeze.Plasterers will benefit the most,with a 12.5%increase,with other trades receiving increases from 3%to 12%.Hong Kongs Chief Executive delivered his Policy Address in October 2022,highlighting a number of key policies such as land reclamation,cavern development,urban renewal

112、and new railways that are relevant to the real estate,construction and infrastructure sectors.This roadmap represents a major boost for the construction industry.It will ensure sufficient workloads in the public sector in coming years,amid deteriorating sentiment in the private sector.As of Septembe

113、r 2022,the construction cost index in South Korea rose by 8.64%year-on-year.Among the sub-indices of the building construction sector,the residential building index rose by 8.35%,and the non-residential building index rose by 8.01%year-on-year.Meanwhile,sub-indices of the civil engineering sector sh

114、owed a smaller extent of increase.CURRENT MARKET CONDITIONSIn the third quarter of 2022,Chinas GDP increased by 3.9%year-on-year.Several other key economic indicators also showed sustained growth.Despite this sustained economic growth,Chinas domestic economic recovery remains uneven in light of the

115、unstable global outlook.More time and effort is needed to rebalance the market as the global COVID-19 pandemic continues to evolve.Since September 2022,the US dollar interest rate hikes have led to the depreciation of global currencies,including the Chinese Yuan(CNY).In addition,strict implementatio

116、n of the dynamic zero clearance COVID-19 policy in China has resulted in an economic slowdown.Investment in real estate in China showed a downward trend.In the coming quarters,development of Chinas real estate market and fixed asset investments will rely on the gradual relaxing of local COVID-19 res

117、trictions and government infrastructure investment.The Hong Kong economy showed a widened year-on-year contraction in the third quarter of 2022.Business sentiment remained cautious,with elevated global inflation and monetary tightening by major central banks.According to the advance estimates,Hong K

118、ongs real GDP fell by 4.5%in the third quarter of 2022 from a year earlier,after decreasing by 1.3%in the previous quarter.Despite a 1.1%drop in the gross value of construction works in the private sector,total expenditure on construction rose by 2.5%in real terms year-on-year.This is compared to a

119、7.0%increase in the previous quarter.In the near future,public works will remain the key driver to support the construction industry as the new-term Government streamlines development-related procedures and expedites land supply.South Koreas GDP increased by 1.5%in the third quarter of 2022 compared

120、 to the previous quarter.Construction output also rose by 3.9%in September of 2022 year-on-year.The Government plans to initiate housing redevelopment projects by building 830,000 houses across the country over the next three years.With increased housing supply,the total area of residential permit i

121、ncreased significantly in the third quarter.RLB TPI ANNUAL%MOVEMENTPEAK GROWTHMID DECLINEPEAK DECLINETROUGH GROWTHMID GROWTHTROUGH DECLINEOUTER RING-MARKET SECTORS AS AT Q4 2022INNER RING-MARKET SECTORS AS AT Q2 20227.1%28.6%3.6%7.1%17.9%28.6%28.6%10.7%14.3%21.4%17.9%14.3%MARKET SECTOR ACTIVITY CURR

122、ENTPREVIOUSMOVEMENT202220232022202320222023BEIJING(2.5)2.03.02.0(5.5)0.0CHENGDU0.03.03.03.0(3.0)0.0GUANGZHOU2.02.04.03.0(2.0)(1.0)HONG KONG7.24.06.64.00.50.0MACAU0.52.00.52.00.00.0SEOUL9.69.16.62.03.07.1SHANGHAI(4.4)3.04.54.0(8.9)(1.0)SHENZHEN0.01.04.03.0(4.0)(2.0)PREVIOUS=FORECAST Q2 2022CURRENT=FO

123、RECAST Q4 202219Raffles Hotel,SingaporeRider Levett Bucknall|International Report Fourth Quarter 202220REGIONAL INTELLIGENCESOUTH ASIACONSTRUCTION COST IMPACTConstruction costs continue on an upward trajectory on the back of labour shortage,stiff global competition for resources,sporadic supply chai

124、n disruptions,the energy crisis,global threats and conflicts,and other market uncertainties.Within the region,material costs,labour availability and supply chain logistics make up the dominant factors affecting construction cost escalations,suggesting that these areas play a crucial role in keeping

125、costs stable.Government interventions(such as price control measures and legislation)in some countries have helped reduce cost risks.In Vietnam,costs and supply of locally mined minerals as construction materials will be monitored under a mechanism to ensure progress of projects.Meanwhile,contractor

126、s of public housing projects in Singapore were protected from fluctuations in steel prices for an extended period when prices rose by more than 75%at its peak,compared to pre-COVID costs.Rising interest rates and inflationary pressures remain a risk over the medium term,with projects in various mark

127、ets trending over budget.In terms of demand for new developments,rising interest rates are likely to hurt pre-sales.Potential homeowners are holding off on buying and developers are reducing the number of new launches in the private sector.Worries about the economic outlook in the new year are also

128、likely to dampen demand.CURRENT MARKET CONDITIONSCountries in the South Asia region continue to report recovery from pandemic-related setbacks,and outbreaks of new dominant COVID-19 strains have been kept under control.There is a general air of optimism in the market with a healthy pipeline of works

129、 for majority of the region,despite challenges ahead.Prices of core construction materials remain elevated despite the softening of raw metal prices in the second quarter of 2022.This is because supply chains and ports are still experiencing delays.The fluctuation in the price of oil and gas,combine

130、d with a strong US dollar,is also contributing to the cost of imported materials,significantly impacting countries that are reliant on imported materials,such as Singapore.The labour force situation differs throughout the region.In countries where domestic labourers make up majority of the construct

131、ion workforce,it is reported that supply remain abundant and competitive.On the other hand,Malaysia and Cambodia have noted tight labour markets as shortages of skilled and unskilled foreign labourers have restricted project progress.In Singapore,the inflow of less skilled labourers and the outflow

132、of skilled labourers has resulted in a high rate of labour unproductivity.Developers in Malaysia are adopting a wait-and-see approach for pre-tender projects.This is in anticipation of incentives and policies that the incoming government is likely to implement following the recent general election.I

133、n Vietnam,general inflation remains low,at a maximum of 4%for the whole year.The Cambodian market is projected to expand by 6.3%in 2022,supported by investments in the infrastructure,commercial and residential sectors.The Indonesian market is projected to expand by 5.8%this year,supported by investm

134、ents in the infrastructure and residential sectors.RLB TPI ANNUAL%MOVEMENTPEAK GROWTHMID DECLINEPEAK DECLINETROUGH GROWTHMID GROWTHTROUGH DECLINEOUTER RING-MARKET SECTORS AS AT Q4 2022INNER RING-MARKET SECTORS AS AT Q2 20225.7%2.9%0.0%11.9%40.0%38.1%2.4%35.7%11.9%8.6%40.0%2.9%MARKET SECTOR ACTIVITY

135、CURRENTPREVIOUSMOVEMENT202220232022202320222023HO CHI MINH CITY4.65.18.83.0(4.3)2.1JAKARTA5.10.05.1NP0.0NPKUALA LUMPUR3.04.03.0NP0.0NPSINGAPORE8.85.06.53.02.32.0PREVIOUS=FORECAST Q2 2022CURRENT=FORECAST Q4 202221Surf Lakes,Los Angeles,AmericaRider Levett Bucknall|International Report Fourth Quarter

136、202222REGIONAL INTELLIGENCENORTH AMERICACURRENT MARKET CONDITIONSAmid recessionary fears,continued inflation and higher staffing costs,overall commercial construction activity has remained strong.With this demand for construction services,there are some significant challenges impacting construction

137、schedules and the ability to reach profitability goals that are resulting from supply-side issues including worker shortages,equipment delivery delays and elevated materials prices.While it is good news that there is this strong demand for construction services,it has been impacted by supply chain i

138、ssues,limiting companies ability to fully benefit from this current demand.That demand will likely continue to grow as Infrastructure Investment&Jobs Act(IIJA)projects come to fruition.According to the U.S.Department of Commerce,construction-put-in-place during July 2022 was estimated at a seasonall

139、y adjusted annual rate of$1,777.3 billion,which was 0.4%below the revised June estimate of$1,784.3 billion,and 8.5%above the July 2021 estimate of$1,637.3 billion.In Canada,the first six months of 2022 saw the highest-ever investment totals recorded in the Greater Toronto Area commercial real estate

140、 investment market.The first half of the year registered record-breaking investment in residential land,followed by industrial assets,both of which are still in high demand heading into the second half of the year.The investment surpassed$19.2B in the first two quarters of 2022,a 41%increase over th

141、e same period in 2021.Workforce shortages are so severe,they are having a significant impact on construction firms of all types and all sizes.A recent survey of firms found that 91 percent of construction firms are having a hard time hiring workers,which is contributing to increased costs of project

142、s too.These staffing shortages are compounding the challenges of supply chain disruptions,inflating the cost of construction materials and creating uncertainty around delivery schedules and product availability.While the future of supply chain disruptions cannot be accurately predicted we know its i

143、mportant for commercial construction companies to become more actively involved in developing a more resilient supply chain,using upgraded technology and employing more proactive forecasting.RLB TPI ANNUAL%MOVEMENTPEAK GROWTHMID DECLINEPEAK DECLINETROUGH GROWTHMID GROWTHTROUGH DECLINEOUTER RING-MARK

144、ET SECTORS AS AT Q4 2022INNER RING-MARKET SECTORS AS AT Q2 202224.5%5.1%4.1%34.7%17.3%6.1%2.0%18.4%7.1%14.3%31.6%34.7%MARKET SECTOR ACTIVITY CONSTRUCTION COST IMPACTInflation is having an impact on supply chain challenges,with material prices rising sharply in the commercial construction sectors.Alt

145、hough the annual inflation rate in the US eased for a second straight month to 8.3 percent in August,it is still at a 40-year high and above market forecasts of 8.1 percent.When combined with the related,rising interest rates,inflation is impacting the cost of everything from materials to wages,and

146、with volatile pricing predicted to continue,certain existing construction supplies,like glass,concrete and lumber,will remain at risk.Overall material costs rose 10 percent nationally in the first half of the year,with specific shortages in glass and concrete.From July to August,the price of materia

147、ls and services used in nonresidential construction finally dropped by just over one percent,but it was the dramatic drop in fuel prices that masked the actual cost of construction supplies.Energy prices have soared 34.6%over the past year,the fastest since September 2005.Food jumped 10.1%and the co

148、st of fuel oil more than doubled,jumping 106.7%the largest increase in the history of the Consumer Price Index(CPI),which dates to 1935.CURRENTPREVIOUSMOVEMENT202220232022202320222023BOSTON9.78.09.07.50.70.5CHICAGO10.04.57.03.03.01.5DENVER8.87.08.47.00.40.0HONOLULU4.76.05.16.0(0.4)0.0LAS VEGAS8.06.5

149、7.06.01.00.5LOS ANGELES7.25.06.05.01.20.0NEW YORK7.87.09.57.0(1.7)0.0PHOENIX8.96.07.15.51.80.5PORTLAND10.47.06.55.53.91.5SAN FRANCISCO5.75.05.65.00.10.0SEATTLE10.25.08.53.51.71.5WASHINGTON D.C.8.87.07.56.01.31.0CANADACALGARY8.35.05.54.52.80.5TORONTO12.37.09.05.03.32.0PREVIOUS=FORECAST Q2 2022CURRENT

150、=FORECAST Q4 202223Waltzing Matilda Centre,Winton,AustraliaRider Levett Bucknall|International Report Fourth Quarter 202224REGIONAL INTELLIGENCEAUSTRALIACURRENT MARKET CONDITIONSThe Australian construction industry is at a pivotal point.Unprecedented construction activity is being seen across all se

151、ctors,and across all states and territories.This activity surge is being fuelled by post COVID-19 legacies such as government funding of home building incentives(both state and federally led),latent commencements of projects put on hold during the lockdown periods and a slowdown in actual output of

152、the industry on the East Coast due to abnormal weather conditions.Other factors influencing cost increases include the lack of skilled workers around the country.Anecdotally,this shortage has been caused by the exit of foreign workers during the early COVID-19 lockdown period and a decline in immigr

153、ation for almost two years due to Australias locked borders.This skilled labour shortage is also being exacerbated by materials shortages,with a complete restructuring of the supply chains feeding the industry across the country.The industrial shutdowns in China,shipping backlogs and general shippin

154、g cost increases have all had significant impacts on the supply and pricing of foreign sourced goods.The value of work yet to be done within the industry reached a record high of$187 billion as at 31 March 2022).This is an increase of 39%from December 2020.This value of work yet to be done(cost to c

155、omplete)has risen by$41 billion in the past 12 months.This gives rise to more activity in the tail of the current activity surge seen in the past 12 months across the country,with all states contributing to this increase.Looking ahead into 2023,RLB forecasts that the pressure points in supply chains

156、 will begin to ease in parallel with the curtailing of global demand driven by inflationary pressures in all main economies.This easing of demand should allow manufacturing and logistics to resume normal activities.RLB also expects to see a softening of material prices compared to the high levels of

157、 demand-led price premiums currently in play.RLB TPI ANNUAL%MOVEMENTPEAK GROWTHMID DECLINEPEAK DECLINETROUGH GROWTHMID GROWTHTROUGH DECLINEOUTER RING-MARKET SECTORS AS AT Q4 2022INNER RING-MARKET SECTORS AS AT Q2 202222.6%29.0%11.3%1.6%27.4%29.0%4.8%4.8%19.4%14.5%22.6%12.9%MARKET SECTOR ACTIVITY CON

158、STRUCTION COST IMPACTHead contractors have reported continued volatile pricing from the subcontract market,difficulty in confirming pricing,and subcontractors being selective in committing to tenders.Many subcontractors are at capacity or unable to secure the appropriate levels of labour.Supply chai

159、n instability,shipping costs and the battle to secure appropriate levels of skilled labour are all set to remain constant obstacles as we see out 2022 and move into 2023.Significant surges in tender pricing have been experienced in all states.Escalation uplifts for 2022 are well above the levels for

160、ecast earlier in the year.Suppliers are unable to hold pricing and guarantee availability when tendering.While material price increases have been a risk,contractors and subcontractors have historically navigated and managed these risks.Currently,tenders are specifying supply rates for key materials

161、as a condition of tender pricing,resulting in rise and fall price adjustment mechanisms being negotiated into contracts.With the levels of approvals dropping and issues surrounding cost increases,supply chain uncertainties and labour availability,there could be a slowdown of activity in 2023 to some

162、 extent.This will be compounded by rising interest rates from the Reserve Bank of Australia(RBA),and the forecast general slowdown of the economy.While generally within expected ranges,builders margins are moving upwards,and are dependent upon contractors appetite for a particular project.Contractor

163、s preliminaries are on an upward trend due to increasing wage pressure,higher insurance costs,longer duration of projects and general commodity price increases.CURRENTPREVIOUSMOVEMENT202220232022202320222023ADELAIDE12.53.84.83.87.80.0BRISBANE10.55.110.55.10.00.0CANBERRA5.04.05.04.00.00.0DARWIN7.85.0

164、4.05.03.80.0GOLD COAST15.57.511.55.54.02.0MELBOURNE8.04.08.04.00.00.0PERTH9.45.69.05.00.40.6SYDNEY6.93.96.93.90.00.0TOWNSVILLE12.68.012.65.50.02.5PREVIOUS=FORECAST Q2 2022CURRENT=FORECAST Q4 202225Christchurch International Airport Limited Agri Export Precinct,Christchurch,New ZealandRider Levett Bu

165、cknall|International Report Fourth Quarter 202226REGIONAL INTELLIGENCENEW ZEALANDCONSTRUCTION COST IMPACTConstruction costs have been extremely volatile during 2022.Global factors of commodity prices and shipping and fuel costs have added pressure to a local market experiencing labour shortages and

166、material supply has struggled to keep with the rate of building activity.This has seen project delays and rising costs.Through the first half of 2022,major projects with long procurement timeframes were unable to secure fixed pricing on materials.There were some price validity periods as short as se

167、ven days.This has seen the addition of cost fluctuation clauses to construction contracts,not seen for decades,and an increased project cost risk profile for clients.With commodity prices and shipping costs stabilising over recent months,it appears that contractors are more able to fix pricing at th

168、e time of tender.However,it is likely that cost fluctuation clauses will remain in some large contracts for the foreseeable future.Legislation and building code changes in thermal and moisture requirements will also have an effect on project costs consented from mid-year.Combined with recent year ch

169、anges on seismic and fire building requirements,compliance is adding significant cost to building projects.On a national average,cost escalation is forecast at 12%for 2022.This is variable depending on location and building type.For example,in the high density residential space there has been cost e

170、scalation well in excess of this.The national forecast in 2023 is for the rate of escalation to slow but to continue increasing given underlying economic inflation,wage pressures and global volatility.CURRENT MARKET CONDITIONSNew Zealand is in a period of high inflation driven by post pandemic commo

171、dity prices,supply chain issues,labour shortages,fuel costs,and central government and consumer spending.Inflation is forecast to remain at high levels for the remainder of 2023.This is despite the central bank aggressively raising interest rates throughout the year to a rate of 4.25%in November 202

172、2.Residential building activity is showing signs of weakness after years of solid growth.High mortgage rates,low immigration and significant new stock is affecting demand and new build enquiries.Non-residential construction activity has remained strong through 2022 despite being plagued by high cost

173、s and labour shortages.Sectors such as aged care,infrastructure including horizontal,schools,hospitals and data centres has been a large part of activity this year and is forecast to continue in to 2023.It is expected that there will be challenging times ahead for the construction industry next year

174、 as monetary policy takes effect.The subsequent drop in demand will stall or stop some currently planned projects.RLB TPI ANNUAL%MOVEMENTPEAK GROWTHMID DECLINEPEAK DECLINETROUGH GROWTHMID GROWTHTROUGH DECLINEOUTER RING-MARKET SECTORS AS AT Q4 2022INNER RING-MARKET SECTORS AS AT Q2 202219.0%23.8%9.5%

175、14.3%14.3%4.8%19.0%19.0%9.5%28.6%19.0%19.0%MARKET SECTOR ACTIVITY CURRENTPREVIOUSMOVEMENT202220232022202320222023AUCKLAND12.05.57.55.04.50.5CHRISTCHURCH9.05.07.05.02.00.0WELLINGTON9.05.04.03.05.02.0PREVIOUS=FORECAST Q2 2022CURRENT=FORECAST Q4 202227BT London,United KingdomRider Levett Bucknall|Inter

176、national Report Fourth Quarter 202228REGIONAL INTELLIGENCEUNITED KINGDOMCURRENT MARKET CONDITIONSLike many other countries around the world,the United Kingdom(UK)continues to experience high levels of general price inflation and problematic availability of labour at many levels and in many sectors o

177、f the economy,as well as virtually static GDP growth.Unemployment levels are low economy-wide,and particularly so in construction.This underpins reports from several regions of resource-strain in labour-intensive trades.Despite all of this,workloads remain high,with the last five recorded quarters s

178、howing the highest levels of output on record.For new workload coming to site,the picture is more mixed,but overall figures remain high in most locations.The political difficulties surrounding the aftermath of Boris Johnsons premiership generated significant instability in UK markets.This has only r

179、ecently steadied and the pound recovered somewhat on exchange markets.With the US dollar still strong amid the ongoing geopolitical uncertainty,one expected upside of a weaker pound is the stimulation of inward investment.However,evidence of uplift in that area is currently slim.In the housing marke

180、t,recent surges in interest rates may significantly affect fixed-term mortgage holders and,therefore,the wider residential market when re-mortgaging time comes around.Further,questions and discussions continue around standards in relation to the European market;Government policy is holding to the pr

181、inciple of removing European standards from the UK statute books by the end of next year.All these factors combine to present a complex mix of strengths and weaknesses regionally and nationally.The challenge for contractors and subcontractors is balancing the need for new replacement workload agains

182、t a backdrop of elevated materials and labour costs,and low levels of wider market growth.For developers,parallel challenges around stack-up are developing,as demand stands to be impacted by cost of living effects and future prospects for the UK economy as a whole.RLB TPI ANNUAL%MOVEMENTPEAK GROWTHM

183、ID DECLINEPEAK DECLINETROUGH GROWTHMID GROWTHTROUGH DECLINEOUTER RING-MARKET SECTORS AS AT Q4 2022INNER RING-MARKET SECTORS AS AT Q2 2022CONSTRUCTION COST IMPACTAs noted in the Q2 2022 International Report,tender price movements in the UK became significantly less predictable and uncertain in the fi

184、rst half of 2022.This has eased somewhat in the second half.However,RLB is still seeing UK tender price uplifts in ranges regionally,with low,most likely and a high figure for each location.This use of multiple representations has provided for a broader-based market view.Input costs have risen rapid

185、ly alongside sharply increased fuel costs,lengthening lead-times and consequent increased preliminaries and other time-related costs.RLBs UK construction-orders-weighted-average of tender price uplifts for 2022 now shows a range of between 5.3%and 8.2%the most likely figure now being over 6.5%.Regio

186、nally,high-side figures range from 7.0%to 10.5%,while most likely figures range from 5%to 8.5%.Within these figures,the former bias toward the higher numbers appears to be being replaced with a preference for more central figures.This indicates a maturing of the understanding of how the tendering ma

187、rket is reacting to the ongoing uncertainty.Overall,volatility in pricing is still in play,with continuing materials availability concerns,particularly longer-than-usual lead times for imported goods.This is set alongside high levels of general price inflation and littleif anyGDP growth.With the Ban

188、k of England predicting a recession,contractors will be faced with the need to replenish workload in a highly input-cost-sensitive market and in wider market conditions that may challenge developers stack-ups and new on-site commencements.16.1%16.1%24.5%2.0%42.9%4.1%16.1%7.1%14.3%12.2%10.7%33.9%MARK

189、ET SECTOR ACTIVITY CURRENTPREVIOUSMOVEMENT202220232022202320222023CARDIFF7.06.0NPNPNPNPBIRMINGHAM5.55.05.55.00.00.0BRISTOL4.03.07.02.8(3.0)0.3LEEDS8.53.06.54.02.0(1.0)LONDON6.03.56.05.00.0(1.5)MANCHESTER7.05.57.05.50.00.0SHEFFIELD8.53.06.54.02.0(1.0)THAMES VALLEY5.03.55.05.00.0(1.5)PREVIOUS=FORECAST

190、 Q2 2022CURRENT=FORECAST Q4 2022Rider Levett Bucknall|International Report Fourth Quarter 202229REGIONAL INTELLIGENCEMAINLAND EUROPE CURRENT MARKET CONDITIONSFollowing-on from the rapid“post-Covid”recovery of GDP figures across Europe in 2021,the year 2022 is forecast by the IMF to have been one of

191、a broad return to zero per capita growth at best for 2022,and most western European countries in the red for the year.While some of the eastern European countries such as Czech Republic,Hungary and Poland will have seen positive figures in 2022,the advent of the Ukraine conflict has not only stifled

192、 further recovery,but also resulted in a whole new spectrum of challenges.Ballooning energy costs and hesitance over availability of winter supplies,overlaid on the tableau of Covid and even Brexit effects,provide a set of separately difficult problems and collectively complex and interwoven issues.

193、Low unemployment rates and consequent continent-wide labour shortages,from unskilled through to skilled and professional,are only adding to inflationary pressures,yet providing for little productivity-led growth,due to rapidly inflating input costs.Because of the standing of the construction industr

194、y as a producer of about 9%of GDP,and its known potential as a stimulator of economic growth,construction has long been a focus of nations tactics for climbing out of recessions.However,at this current point,priming the construction pump would seem to be akin to simply inflating the economies of Eur

195、ope rather than re-floating them.Almost without exception,2022 has been a year of construction tender price inflation not seen in recent years,not so much because of demand pull,rather by virtue of cost push.While few in the workforce can really remember the oil crises of the early 1970s and the rel

196、ated cost push and wages spirals that flowed from them,governments everywhere will have to deal with similar effects in the coming year or so,rendered especially problematic by currently low levels of unemployment.Further,the European Commissions website states that:“The updated EU industrial strate

197、gy highlights the need to accelerate the green and digital transition of EU industry and its ecosystems.To that end,it proposes working together with industry,public authorities,social partners and other stakeholders.”This offers yet more opportunity and challenge to the construction industry,hamper

198、ed as it is by skills constraints and training gaps.The expected recovery of the construction industry in Europe in 2022 has inevitably been affected through almost the whole year by the ongoing situation in Ukraine.While Covid has appeared to have paled into the past as an issue,any bounce-back has

199、 been overtaken by materials shortages,lead-in extensions and labour shortage concerns,really throughout the region.Downstream effects include live-projects programmes blowing-out,additional cost pressures to ongoing and near-to-tender projects and new-investment deferrals.By way of example in Weste

200、rn Europe,the market in Germany continues to be buoyant due to investors having great confidence in the logistics,residential and industrial sectors.However,due to soaring energy costs and continued materials price increases due to their non-availability,some investments are being put on hold.Contra

201、ctors are already seeing opportunities fading away,which is softening the market already,and we expect a continuation for the year 2023.The hotel sector is making a strong return due to increased travel activities in Germany,and investments overall will remain high.Prices will continue to be affecte

202、d by soaring energy prices,leading to the possibility of some construction slow-down.For Hungary in Eastern Europe,due to the war in Ukraine and political uncertainty with the European Union,some new speculative developments are on hold and a significant amount of state-financed projects were deferr

203、ed.Increasing interest rates have also cooled the overheated residential market.Fewer new building permit applications are being submitted,so the commercial(office,retail)and the housing sectors will slow.Infrastructure developments may slow as well,due to central budget issues and the aforementione

204、d debate with the European Union.However,the industrial sector in Hungary appears to be strong and maintaining that strength as large developments are being started.A number of hotels are also under construction or in the pipeline,but their future is slightly less certain.In the energy sector,extens

205、ion of the nuclear power capability is still ongoing,and some more traditional power stations are being refurbished or renewed.RLB TPI ANNUAL%MOVEMENTCURRENTPREVIOUSMOVEMENT202220232022202320222023BERLIN14.76.0NPNP-BUDAPEST2.52.52.53.50.0(1.0)OSLO8.14.63.5NP4.6-PRAGUE23.010.0NPNP-PREVIOUS=FORECAST Q2 2022CURRENT=FORECAST Q4 2022RLB.comAFRICA|AMERICAS|ASIA|EUROPE|MIDDLE EAST|OCEANIA