Rising construction costs are reshaping the landscape for real estate investment and capital planning—something I see regularly as we collaborate on ground-up developments and value-add projects. Since 2020, annual global construction cost increases have climbed from 2–3% to 3–6%, with forecasts pointing to 3.1–4.2% annual growth through 2027. These shifts are fueled by higher wages, ongoing supply challenges, and new AI-driven demand, impacting property types in very different ways. For owners and operators, understanding how these cost pressures shape project feasibility is essential to transparent capital expense planning. My focus remains on helping clients uncover the real numbers behind their investments—optimizing rent rolls and clarifying CapEx—so they’re equipped to make solid, data-driven decisions in this evolving environment.
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