According to the accompanying table and charts, a typical nursing home had the largest year-over-year increase in construction costs in November 2007 (+7.0% on average for 25 major centers) among four medical and residential project categories monitored by RSMeans. In second place was a four- to eight-story hospital (+6.8%), followed by an apartment building (+6.0%) and in the final position, a two- to three-story hospital (+5.5%).

As for the actual dollar-per-square-foot cost of construction, a two- to three- story hospital is most expensive, followed by a four- to eight-story hospital, then an apartment building and a nursing home.

New York can be $100 per Square Foot More Expensive
New York is the most expensive city in which to build in the United States, with San Francisco in second place. Boston, Philadelphia and Chicago form a third tier. Minneapolis, Los Angeles and San Diego are also relatively expensive.

It is informative to provide some perspective on regional construction costs. For example, it costs approximately $100 more per square foot to build a hospital in New York than in such other major centers as Denver, Atlanta, Miami, Phoenix and Houston.

As two further examples, it costs almost 30% more to build in Chicago than in Atlanta and there is a similar spread between high-cost Philadelphia and low-cost Miami. Finally, the premium between the highest-cost city, New York, and the lowest-cost city in the table, Winston Salem, is +67%.

For a related Reed Construction Data story on city construction costs, please see the recently posted article entitled, “Latest Construction Cost Index Change is Below Consumer Price Index Change”.

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