LEEDS, U.K.—U.K.-based real estate and infrastructure consultant Turner & Townsend has released its 2022 Canadian Construction Market Intelligence Report which suggests inflation could stay elevated the rest of the year, impacting the construction sector.
The report provides market analysis and a construction cost guide for a range of building asset classes across major cities in Canada.
Canada’s economy is expected to continue to grow despite the changing macroeconomic environment. The tight labour market and supply chain disruptions continue to impact productivity and the availability and cost of goods and building commodities.
Locally, many provinces are experiencing stronger economic conditions, with a high volume of new job openings as firms increase hiring in anticipation of future demand.
Turner & Townsend expects several interest rate increases in 2022 could introduce volatility to the market. But, while the looming policy changes could impact the capital investment outlook for some industry segments, others are experiencing overwhelming consumer demand, such as data centres and supply chain logistics facilities, where speed-to-market and capacity remain paramount to their operations and revenue.
Additionally, ESG (Environmental, Sustainability and Governance) considerations are playing an ever-greater role in how and why capital is invested, prompting the construction sector to transform itself through innovation and financial commitments to sustainable, net-zero policies.
The net result is likely to see some segments maintaining a “wait and see” position, the report stated, while others accelerate existing construction development plans to meet future regulatory and consumer demands.
The report also spotlighted opportunities in Canada’s natural resources sector, which accounts for over 15 per cent of GDP. Carbon capture, storage, and utilization technology is an opportunity for Canada’s emission-intensive industries to maintain competitiveness in a net-zero world. While the technology may not be fully proven at large scale, several projects have commenced.
A pragmatic technology- and data-driven approach can help to minimize risk and maximize the value of these projects, suggested Turner & Townsend.
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