A new, rather dry, and number-heavy report came out earlier this month. It would be easy to skim through if the the words “San Francisco” and “construction” weren’t so prevalent. Thanks to the International Construction Market Survey, it’s now become clear that hilly little S.F. has moved up the list to become the second-most-expensive city in the country in which to build, well, pretty much anything.
Professional research team Turner and Townsend studied 43 global markets to come to this conclusion. “This year, 60 percent of the cities analyzed are currently identified as ‘warm, hot, or overheating’ construction markets — including Seattle, San Francisco and New York,” the report states.
New York is in first place — it currently costs an average of $354 per square foot of construction in the Big Apple. But S.F. isn’t far behind, at $330. Seattle comes in third at $280 per square foot, and Houston is fourth, at $233 per square foot.
Part of the cost increase is credited to rising labor rates, combined with labor shortages. Construction workers in North America now get paid an average of $72.50 per hour. In San Francisco, the average is $73. In New York, that number is closer to $100. While those numbers may seem sky-high, keep in mind that they reflect the jobs of everyone involved, not just laborers — and also includes worker benefits, such as travel costs, insurance, and pension.
Will San Francisco continue to be near the top in next year’s report? Most likely. Thanks to projects like the Central SoMa Plan, which will create 7,500 new units of housing, plus the ground-breaking of the new Warriors arena and development of Mission Bay, the digging, drilling and building isn’t going to stop anytime soon.