Two Things Were Supposed to Save Construction This Year. Neither Showed Up.
This month's recap covers what June 2026 actually meant for the industry, and it was not what anyone had pencilled in.The cheaper borrowing that stalled schemes were relying on did not arrive. The European Central Bank raised...
Economic Challenges and Material Costs
The anticipated drop in borrowing costs did not occur. The European Central Bank increased interest rates while the Federal Reserve and the Bank of England maintained theirs. Additionally, oil prices surged above $125 per barrel due to concerns about the Strait of Hormuz, causing central banks to hesitate on rate cuts. Meanwhile, US tariffs on steel, aluminium, and copper remain at 50%, driving non-residential material costs up at the fastest rate since 2022. These factors combined to add approximately $17,500 to the cost of building a new American home.
Data Centres Outpace Offices but Face Power Constraints
Data centres have become the largest construction category, surpassing offices in scale. However, the main obstacle is not financing but power availability. Grid connections are delayed by five to seven years relative to construction timelines. This mismatch limits growth despite strong demand, emphasizing the critical role of megawatt capacity in enabling this sector.
Additional Highlights and Industry Insights
The episode also summarizes three June briefings covering safety technology, the evolving AI price competition, the implications of AI delivering knowledge directly to clients, and the unique reconstruction technology deployed in Ukraine, which notably is not a crane. Trivia includes Gustave Eiffel’s engineering inside the Statue of Liberty and a discovery beneath a Boston World Cup pitch untouched for two decades.
Join the conversation on LinkedIn to share your perspective on these developments.
