Date: October 30, 2025 Edition: Late October 2025
This week’s briefing highlights developments from the past seven days, including labor wage proposals in Los Angeles, softening lumber prices amid tariffs, multi-family construction trends, and escalating public project risks exemplified by the Capitol Annex scandal. With a federal government shutdown delaying key data releases, focus on local policy shifts and market signals for bidding and cost controls.
Building Permits
Local adoption of the 2025 California Building Standards Code advances, with Elk Grove City Council approving the first step on October 22 to incorporate updates effective January 1, 2026—expect similar moves statewide to standardize wildfire resilience and energy requirements. Reminders persist for submitting plans by December 31, 2025, under the prior code to sidestep upgrades. A stark cautionary tale emerges from the Sacramento Capitol Annex project: costs have ballooned from $500 million in 2018 to $1.1-1.6 billion, with overseers (including Gov. Newsom’s team) refusing financial disclosures and providing no updates in three years—highlighting opacity risks in public bids that could spike contingencies by 200%+.
Construction Starts
California leads with 39.8% of new housing authorizations as multi-family (40,402 units), surpassing the U.S. average of 33.6%, signaling a pivot from single-family amid mandates. Hines’ JV broke ground October 29 on Riverwalk San Diego’s first phase: 721 multifamily units, underscoring momentum in urban infill despite broader residential slowdowns. Amid the shutdown, monitor for delayed federal stats, but non-residential like healthcare remains steady.
Material Costs
Lumber prices eased 2.82% daily to $550.50/1,000 board feet (October 29), down 10.2% monthly, pressured by U.S. tariffs (10-25% on Canadian softwood atop 35% duties) flooding markets with excess stock despite elevated import costs—opportunity to lock in savings before Q4 rebound forecasts to $598. ENR updated Los Angeles and San Francisco City Cost Indices for October, reflecting ongoing volatility; track for regional escalations. Tariffs continue inflating steel/aluminum/copper, but oversupply tempers pass-through to bids.
Labor Trends
Los Angeles City Council votes this week on studying a minimum wage hike to $32.35/hour plus $7.65/hour health credits for multifamily workers (10+ units, <85 feet tall)—exempting union projects, targeting median $18/hour pay and wage theft affecting undocumented labor. Proponents cite affordability needs; critics warn of cost hikes mirroring prior agreements that slashed unit production—budget 10-20% premiums if enacted, prioritizing skilled trades amid shortages.
Other Key Information for Financial Decisions
Federal shutdown stalls September construction data, extrapolating slim growth amid California’s sluggish economy: stalled jobs, tariff vulnerabilities in manufacturing/construction, potential recession signals. AI/tech may offset deportations/tariffs per UCLA’s San Francisco outlook, but prioritize industrial/multifamily. New October employment laws (e.g., compliance for 2026) add HR costs; Capitol overruns underscore auditing public contracts. Hedge with forward buys on softening lumber, but brace for wage/labor policy shocks inflating bids 5-15%.
Sources: All data sourced from Grok’s web lookups, with inline citations referencing specific results for transparency. For full articles, refer to the linked URLs in the original search outputs.