Construction costs still rising

THE COST OF construction in Barbados continues to escalate, says property and development consulting firm BCQS International in its latest 2023-2024 Caribbean and Latin America Construction Market Trend Report.

The 2020-2022 edition of the publication, BCQS stated that construction costs in Barbados had increased by 16 per cent and in the new report it said these costs had gone up by a further 8.35 per cent in 2023-2024.

The construction costs referenced comprised “primary materials, plant, and labour elements” which BCQS said reflected “the core constituents of most construction projects within the region”, but did not “explicitly account for the additional costs associated with specialty items, which can vary significantly based on market fluctuations and geographical considerations”.

The report examined a range of indicative construction costs, including those for residential and commercial properties.

The 2020-2022 report said that these costs for residential properties ranged from a low of US$125 per square foot for a modest quality residence up to US$500 per square foot for high quality. Those costs have increased further, with the 20232024 publication detailing a range of US$140 per square foot for a modest quality residence to US$550 per square foot for a high quality one.

For commercial properties, the 2022-2023 indicative construction costs were US$90 to US150 per square foot for storage/warehouse, US$150 to US$250 per square foot for retail single storey, and US$350 to US$590 per square foot specialist office.

This time around, building costs for these properties, except specialist office, have decreased.

In 2023-2024 storage warehouse is US$90 to US$140 per square foot, retail single storey US$$150 to US$240 per square foot, and specialist office US$380 to US$630 per square foot.

BCQS said the information provided in the latest report was “derived from our year-on-year cost escalation analysis, offering a reliable guide with a 95 per cent confidence level”.

BCQS managing director Liam Day said the research “indicates an average increase in construction costs of 7.25 per cent across the fifteen jurisdictions surveyed over the past twelve months since our last market study published in 2023, with increases ranging from 0.21 per cent to 22.47 per cent [for Guyana]”.

“The average increase across all jurisdictions of 7.25 per cent indicates that the rate of cost escalation has ‘slowed’ compared to the previously reported average of 19.22 per cent over the two-year period from 2021 to 2023, equating to 9.61 per cent per annum,” he stated.

In addition to Barbados, Caribbean countries covered in the report are Antigua & Barbuda, Anguilla, Aruba, The Bahamas, British Virgin Islands, Cayman Islands, Curacao, Guyana, Jamaica, St Lucia, Saint Barthélemy, St. Maarten, Trinidad and Tobago, and Turks & Caicos Islands.

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