Industrial construction costs are rising across the Americas as improving demand and a recovering development pipeline create renewed competition for materials and skilled labor, according to Cushman & Wakefield’s 2026 Industrial Construction Cost Guide.
The report found that construction costs increased across all three project sizes tracked. Small industrial projects rose an average of 3.6% year-over-year to $144 per square foot. Medium projects increased 2.8% to $87 per square foot, while large projects rose 2.3% to $78 per square foot.
“The industrial recovery is becoming more expensive,” said Michael Morehead, Industrial Manufacturing Sector Lead, Americas, Project & Development Services at Cushman & Wakefield. “Our research shows demand strengthening and the construction pipeline rebuilding, while development costs are rising across virtually every market we track. For occupiers and developers, that means the next phase of the cycle will require even greater discipline around location, building specifications and capital planning.”
Another factor driving the trend is that U.S. construction cost pressures are shifting from labor to materials, with construction-related commodity prices rising 13.3% year-over-year (YOY), the firm said in another report, “Construction Insights for Global Occupiers.” That conversion is being driven because input costs are being pushed higher by tariffs, metals supply constraints, and demand from data centers and infrastructure projects.
The increase in commodity prices is more than 4.7 times the rate recorded a year earlier, led by aluminum at 40.9%, copper base scrap at 39.3% and nonferrous metals at 38.5%. At the same time, labor cost growth has moderated, creating a markedly different construction inflation environment from recent years.
