Our east region experienced an average year-over-year construction cost increase of 4.55% (above the national average of 4.37%). These cities include New York (3.99%), Boston (4.61%), Washington, D.C. (4.12%), Nashville (4.54%), and Miami (5.50%).
Consistent trends included a sharp decline in multifamily and public-sector spending, teamed with a non-residential commercial construction boom, indicating a collective economic pivot toward large-scale commercial developments.
Infrastructure investment remains constant amongst all regions, as east-coast markets seek to anchoring long-term economic growth across public-sector infrastructure projects.
Rising construction costs and a consistent labor strain remain a risk to some of these regions, while others are more directly impacted by interest rates, as their economic development is heavily reliant on private-equity spending. We know from our national perspective that private equity investment is in a wait-and-see holding pattern, as private equity firms remain reluctant to borrow due to interest rates remaining high. The growth of cities like Nashville, slated to be one of America’s top 10 fastest-growing U.S. metros, would be heavily impacted by this.
The map below compares the annual percentage change for the East Region of the U.S.; the gallery below shows the quarterly percentage change for individual East Region cities.
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