Construction costs for commercial and industrial real estate retreat from peak levels
Market observers report a notable decline in construction costs for commercial and industrial real estate, easing by 5 to 20 percent against the highest figures seen in the previous year. The price per square meter varies by segment, now ranging roughly from 45 thousand rubles to 150 thousand rubles, according to insights cited by Kommersant from industry participants.
The most affordable segment remains warehouse construction, where the cost per square meter typically falls in the 45 to 50 thousand rubles band. Analysts note that the upper end of pricing is concentrated in the A class office sector, with buildings typically situated in central districts or in prestigious new developments and business centers.
Industry sources point out that developers are effectively returning to 2021 cost levels, reflecting a year over year decrease of five to twenty percent from last year’s peaks. In April, the average cost for constructing dry warehouses in Moscow and the surrounding region stood around 50 thousand rubles per square meter, and the rate declined by roughly twenty percent when compared with the previous year. Current figures place warehouse construction at about 45 to 47 thousand rubles per square meter, while shopping centers are generally estimated at 80 to 100 thousand rubles per square meter and A class offices at 120 to 150 thousand rubles per square meter.
On May 14, Kommersant reported, citing market participants, that the Moscow and St. Petersburg commercial real estate markets began showing gradual signs of recovery in May 2023. A key driver behind this revival has been the improved traffic and footfall in shopping centers, which contributed to renewed activity and confidence across the sector. The trend appears to be supported by ongoing demand for logistics and distribution facilities, alongside selective development of high‑quality office space in major urban centers. Attribution: Kommersant