Denver Construction Costs

Denver Construction Costs

Denver construction costs are rising. At the end of second quarter 2014, The Denver Business Journal reported construction costs were trending up at 2.2 percent. (Link to article.) Their research is based on a report by Rider Levett Buchnall, a national construction cost estimating consultant with offices in Denver.

Foundation LaborerThe reason for the increases in Denver construction costs are due to a shortage of subcontractor labor in all trades. This includes plumbers, drywall installers, electricians, framers, masons, and mechanical installers. As the amount of available labor “diminish, profit expectations increase or competition is reduced.”

Although the report does not provide the cost to build a church, it does provide Denver construction costs for many other building types.

  • Prime Offices from $140 to 225 per square foot.
  • Industrial Warehouse from $65 to 110 per SF.
  • Elementary School from $125 to 160 per SF.
  • High School from $145 to 215 per SF.

Since the end of the second quarter, my experience is labor costs continue to rise. There is a sever shortage of skilled construction labor throughout the Denver market. I hear stories of many projects having only one or two bidders in most trades. With the labor shortage, I also hear stories of subcontractors unable to complete construction as scheduled because they cannot find the needed skilled laborers.

In the foreseeable future, the general contractors I have talked to say they do not see any change in this Denver construction cost trend. While most material costs are holding steady or have mild increases, labor in Denver will continue to cause construction cost inflation at about five to ten percent per year.

Robert Lee for INvigorate Blog, robertLEEarchitects, September 29, 2014

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