JLL Report Reveals Permanent Rise in Global Construction Costs Impacting Capital Planning
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- AutomationWorld.com
Global construction costs are establishing a new baseline, with increases between 3% to 6%, according to JLL's Global Construction Costs Index 2026 report. This shift is reshaping capital planning and development feasibility across various sectors, particularly impacting manufacturing facilities, high-performance offices, and data centers.
The report highlights that asset classes like industrial facilities and data centers are managing to absorb these elevated costs, while sectors such as office and retail are facing challenges in return-on-investment calculations. The ongoing pressures from global supply chains, politics, and AI-driven demand are contributing to this cost escalation, making static cost assumptions obsolete for real estate investors and developers.
Looking ahead, JLL forecasts an additional rise in global construction tender prices of 3.1% to 4.2% in 2027, with regional variations expected. Labor shortages and wage growth are further exacerbating the situation, creating a performance divide among property sectors. Sectors with strong value appreciation must adopt sophisticated strategies to navigate these challenges effectively.
Original report
JLL Report: Higher Construction Costs Reshape Global Capital Planning
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