Americas Office Fit Out Cost Guide 2023

SUPPLY CHAIN CONSTRAINTS EASING, BUT STILL ELEVATED

Global supply chain stress levels have receded from their 2022 highs but remain above pre-pandemic 2019 levels. Regionally, both China and Latin America supply chain stress levels have returned to a pre-pandemic range. The U.S. experienced the steepest rise in supply chain stress, which hit a peak in September 2021. Current U.S. supply chain stress levels have fallen 22% from this 2021 peak, but remain 23% above the pre-pandemic levels of January 2020. In addition, the supplier delivery index, which measures manufacturer delays, has steadily decreased since the middle of 2021. 1 As of February 2023, supplier deliveries to manufacturers were much faster, down 50% from 2021 levels.

Despite receding stress indicators, U.S. lead times and project timelines continue to be impacted. The average lead time for switchgear—one of the most in-demand and constrained construction systems—continues to be significantly delayed, averaging 12 to 18 months. However, a recent sentiment survey of 72 general contractors (GCs), conducted by Cushman & Wakefield, points to increasing expectations that some of these challenges may be easing. For instance, 11% of respondents expect material lead times to decrease slightly in 2023. This is a significant improvement in sentiment from 2022, when none of the respondents expected a decrease. And 58% of respondents expect project execution time to remain unchanged in 2023—also an improvement from 2022 when only 25% didn’t expect a change. It should be noted that no change to project execution time also means no improvements, and that the challenged timelines of 2022 are expected to remain through 2023.

SUPPLY CHAIN STRESS INDEX (2009-2023)

United States

China

Latin America

Global (RHS)

150

5

140

4

130

3

120

2

110

1

100

0

Supply Chain Stress Index

90

-1

Global Supply Chain Stress Index

80

-2

70

-3

2009 2010 2011

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

2022 2023

Source: Federal Reserve Bank of New York

4

Cushman & Wakefield