What's moving construction budgets in Toronto.
The public numbers that matter to owners, in one place, with what they mean for your program. Updated October 14, 2026.
Toronto construction costs keep climbing for commercial work
Building construction price index, Toronto (2023 = 100)
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| Quarter | Non-residential | Residential |
|---|---|---|
| Q4 2024 | 105.8 | 105.3 |
| Q1 2025 | 106.7 | 105.4 |
| Q2 2025 | 108.2 | 105.6 |
| Q3 2025 | 109.1 | 105.9 |
| Q4 2025 | 109.6 | 106.4 |
| Q1 2026 | 110.3 | 106.5 |
| Q2 2026 | 111.7 | 105.7 |
What it means for owners
- Carry escalation separately from contingency. Commercial construction costs in Toronto rose 3.2% in a year. For work starting in 2027, a 3% to 4% escalation allowance is a defensible starting point. Don't let it quietly eat your contingency.
- Residential has stalled, and that's an opening. Toronto residential costs fell 0.8% last quarter. Trades that depend on housing are looking for work, which can mean sharper commercial tenders right now.
Borrowing costs have held steady for a year
Canadian prime business rate (%)
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| Effective (week of) | Prime rate |
|---|---|
| Jul 2023 | 7.20% |
| Jun 2024 | 6.95% |
| Jul 2024 | 6.70% |
| Sep 2024 | 6.45% |
| Oct 2024 | 5.95% |
| Dec 2024 | 5.45% |
| Feb 2025 | 5.20% |
| Mar 2025 | 4.95% |
| Sep 2025 | 4.70% |
| Nov 2025 | 4.45% |
What it means for owners
- Price your delay, not just your build. At a 4.45% prime rate, carrying $20 million of project financing costs roughly $74,000 a month in interest alone, before holdover rent or lost revenue. That number belongs in every schedule recovery decision.
Fuel is the cost driver to watch
Statistics Canada industrial product prices, July 2026
What it means for owners
- Watch equipment-heavy scopes. Statistics Canada links recent non-residential increases in earthwork, structural steel and conveying equipment to oil and fuel prices. Before you sign, check how your contracts treat fuel and material escalation.
- Tariffs still matter. Metal and steel products led residential cost increases in Q2 2026 because of retaliatory tariffs and supply chain disruption.
Is your budget exposed?
Test your own program with the owner's rep ROI calculator, or book a 30-minute call and we'll walk through your escalation, contingency and schedule risk.
Sources: Statistics Canada, Building construction price indexes, second quarter 2026 (Table 18-10-0289-01), with earlier quarters from the first quarter 2026 and fourth quarter 2025 releases (earlier quarters may since have been revised); Statistics Canada, Industrial product and raw materials price indexes, July 2026; Bank of Canada, interest rates. The financing example is illustrative. This page is general information, not financial or legal advice. Next update after Statistics Canada's third-quarter 2026 release.