Geneva overtakes London as most expensive place to build

The study of comparative construction costs across 100 cities ranks London second behind Geneva and ahead of Copenhagen, which is in third place. The five least expensive cities are found in Asia and India.

The latest International Construction Costs report published by Arcadis finds that, outside of London, UK cities did not record significant shifts in position. Six others are in the top 25: Bristol (15th), Manchester (17th), Birmingham (22nd), Liverpool (23rd), Edinburgh (24th) and Cardiff (25th).

Arcadis said that construction decreased by approximately 13% in the UK and it is forecast to recover to pre-Covid levels only in the beginning of 2022.

The 2021 Arcadis ICC Index covers 100 of the world’s large cities across six continents. The cost comparison was developed covering twenty building functions, based on a survey of construction costs, review of market conditions and the professional judgement from its global team of experts. The calculations are based in USD and indexed against the price range for each building type relative to Amsterdam. This year, coverage has been extended to cities including Oslo, Vienna, Nice, Memphis, Ho Chi Minh City, and Kiev. The devaluation of the US dollar is the main factor contributing to a fall in the ranking of US cities such as New York and San Francisco to sixth and seventh place, respectively.

In addition to providing a comparative index of global construction costs, this report also looks at construction around the world and the noteworthy changes and initiatives of the past year in numerous global markets amid the Covid-19 pandemic. As some governments prepare to launch various initiatives to boost their economies - including investment spending on infrastructure - Arcadis has highlighted the opportunity to create long term value from the right investments especially around sustainability. A five-point plan is presented in the report to help guide clients and their project teams to define and deliver their project requirements in the context of a broader assessment of value.

Nilesh Parmar, deputy chief executive – UK and Ireland, Arcadis, said:

“The UK construction sector managed the pandemic very well. Effective safety measures have enabled productivity levels to recover, and the construction sector has been singled out as a major contributor to the ‘Build back better’ initiative in the UK.  The residential market has been buoyant through the year, supported by Government intervention and global investment into mid-market build-to-rent. By contrast, the focus for investment in public transport is likely to shift away from London to other UK cities in line with the Government’s post-Brexit ‘levelling-up’ agenda.

“The last year has been focused on the global public health crisis but the challenge climate change brings is still very real. With construction contributing significantly toward carbon emissions it is crucial our industry increasingly embeds sustainability into its projects.”

The 10 most expensive cities:

1. Geneva                                                                   

2. London                                                                  

3. Copenhagen                                                          

4. Oslo                                                                        

5. Zurich    

6. New York City     

7. San Francisco      

8. Hong Kong

9. Dublin

10. Macau

The 10 least expensive cities:

100. Bengaluru                                                          

99. New Delhi                                                             

98. Mumbai                                                                

97. Kuala Lumpur                                                      

96. Ho Chi Minh  

95. Wuhan    

94. Chengdu

93. Nairobi

92. Johannesburg

91. Guangzhou

Got a story? Email news@theconstructionindex.co.uk