Skyrocketing steel prices are wreaking havoc with local construction projects and at least one Hamilton affordable housing charity says it needs to go back to the drawing board to figure out how to manage new costs.
Amid the turmoil with President Donald Trump’s 25 per cent steel tariff in the U.S. — and the retaliation by the federal government on this side of the border — steel prices have risen by as much as 40 per cent since January, says steel expert Peter Warrian of the University of Toronto Munk School of Global Affairs.
And products that are made from steel — such as reinforcing bar for concrete and structural steel for office towers — have gone up by more than 60 per cent in some cases.
Graham Cubitt, director of projects and development with affordable housing charity Indwell, says the cost of one of its projects — at 500 James Street North — has jumped by more than $300,000 because of the escalating steel costs.
“When we talked to our general contractor, he said they are seeing increases at all the projects they are working on and our project is going to cost more,” Cubitt said.
The $14-million development will create 45 new apartments as part of the Hughson Street Baptist Church’s new community church facility. The foundation is currently being put in.
Cubitt said the project’s planners are trying to put off buying steel products needed for the construction. “But there are some things we have to go ahead with, such as rebar for the foundation. So it has to be done.
“If there is any way to hold off with some of the structural steel further up in the building, we will. We won’t necessarily sign off on those orders until later in the summer. Hopefully, things will have settled by then.”
He’s hoping for some relief, he said, because Indwell is not sure how to come up with more funding for a project.
Escalating steel prices are being felt in different ways. Companies that are signing contracts for new construction projects are finding additional costs they hadn’t expected. In other projects — that are locked in from being signed several months ago — contractors and subcontractors are having to absorb the increase.
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