Strong demand for coastal construction materials prices rose sharply

The construction cost of the Binhai urban line is expected to increase significantly to 20.7 billion yuan, which is a total of about 8.7 billion yuan higher than the original estimated budget of 12 billion yuan at the beginning of 2007. After deducting the consumption tax, the increase is estimated to reach 8 billion yuan. Among them, as much as 75% of the increase was due to the surge in construction costs, the need for urban lines to meet certain technical requirements and improvements in design, including the addition of more entrances and exits to subway stations.

Most of the increase is related to the first phase of the urban line projected to be completed by the end of next year. Although there are only six subway stations at this stage, the length is also the shortest among the three phases of the urban line, but it was between 2007 and 2008. When launching the market bidding, it happened that construction costs and material prices soared.

The overall demand for the construction industry was very strong. The prices of major construction materials rose significantly, and the market prices of steel and concrete increased by 60% and 14% respectively. The original budget of 12 billion yuan was estimated based on preliminary studies. After the land exchange bureau started detailed engineering and construction studies and took into account the long-term land use plan for land released by the Urban Renewal Authority in 2007, it decided to put the city into consideration. The district line has been extended from the original 40 kilometers to 42 kilometers, and an additional subway station has been built. At the same time, the Land Exchange Bureau also decided to add about 30 entrances and exits to the subway station to further enhance the connectivity so that passengers can get to the subway station. Although the construction costs of urban lines will obviously exceed the original budget, if the main building materials prices remain at the current level, the final construction fee may not be as high as $20.7 billion.