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5/04/23
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This report provided by real estate services firm Cushman & Wakefield
Cushman & Wakefield released its 2023 Fit Out Cost Guide for office markets, finding that supply chain constraints, inflationary pressures and increased labor costs are continuing to apply upward pressure on project costs.
Even as supply chain challenges ease, many office users are suffering from sticker shock as project pricing comes into focus, leaving some planned construction projects on shaky ground, said Brian Ungles, Project & Development Services Americas Lead at Cushman & Wakefield. On a positive note, as occupiers look to upgrade space to attract employees and adopt hybrid work models, the ability to make strategic decisions about the workplace is becoming clearer.
Average fit out costs in the Americas total $136 per square foot (psf), up 11% from 2022. Adaptive reuse of existing space costs are typically priced at a 10-15% discount.
The priciest markets for fit outs are coastal gateway U.S. markets with San Jose being the most expensive market, where fit out costs are roughly 76% higher than the Americas average. The top six markets costs increased an average of 12% from the previous year, with the largest jump being New York at 14%.
San Jose
San Francisco
New York City
Seattle
Sacramento
East Rutherford
The most cost-effective markets are non-dollar denominated Latin American markets.
Colombia
Argentina
Peru
Mexico City
Monterrey
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