The Duff & Phelps cost trend update is now available for
both the Construction Cost and Equipment Cost indices. Construction
costs have been relatively stable over the last five years,
averaging an increase of approximately 2.25%. However, that changed
in 2017, with an increase of 2.7% to 4% in three of the four
indices Duff & Phelps uses to track US construction costs.
Average equipment costs indices are also trending to above average,
with increases in the 0.9% to 2.6% range.
Please be reminded that these indices are only average indicators of change and they are not absolutes. Duff & Phelps advises that after five to seven years, you should establish a new replacement cost basis with the assistance of a qualified valuation professional. Please contact Mark Bobber at Duff & Phelps to discuss establishing a new replacement cost basis.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.