London has the highest construction costs in Europe, and the second highest in the world, new research has shown.
London came second only to New York in terms of construction costs in the annual Arcadis international construction costs index. And another financial centre, Hong Kong, took third place.
It topped other European cities: Geneva (4th), Copenhagen (6th), Stockholm (7th), Frankfurt (8th) and Paris (9th). Generally, these cities experienced less pressure on construction due to a slow recovery following the financial crisis, the report said.
More broadly, in most locations, deflation in many commodity markets and over-supply of key materials such as steel have also helped keep a lid on price rises. Exchange rate movements also made building costs significantly cheaper in European and Asian markets compared to the US and UK.
"Overall a general slowdown in global construction activity has resulted in relatively few locations seeing significant price growth throughout the year," Simon Rawlinson, head of strategic research and insight, said.
"For the cities themselves, the major financial hubs of New York, London and Hong Kong are the most expensive locations in the world in which to build."
"That said, these world cities have also experienced significant resource constraint which has, subsequently, increased costs over the last 12 months."