Construction Costs & Deals Pencilling
After chatting with a bunch of folks, everyone talks about dry powder and people hungry for yields, but I'm also hearing about construction costs/supply chains busting and the obvious timber shortages.
I spoke with some folks on the west coast and even heard that west coast construction labor prices have gone down, but land prices haven't normalized even with the "lower demand" for development. What's the overall calculus that people have been seeing for recent concrete podium/timber development as of recent? Have land prices gone down in major metros because of slowed development? Are landowners holding out due to waiting for price discovery and waiting for dust to settle? Are GC's/subs actually hungry for work and has that compressed labor costs throughout? Has the sum of labor costs and material costs for construction netted more or less expensive construction throughout?
Lots to unpack, would love some insight on what's actually going on with demand and pricing these days, as well as how much supply chains have actually busted schedules and existing timelines.