Des Moines has seen record‑high building permit values in the fiscal year ending June 2025, exceeding $1 billion even after inflation adjustment—nearly double the previous year—indicating strong developer confidence and widespread construction activity across residential, commercial, and adaptive‑reuse projects.([axios.com](https://www.axios.com/local/des-moines/2025/08/19/des-moines-building-permits-construction-housing?utm_source=openai)) However, architecture billings statewide have declined, signaling potential long‑term headwinds for commercial construction.([axios.com](https://www.axios.com/local/des-moines/2025/05/08/iowa-architecture-billings-office-construction?utm_source=openai))
Industrial real estate remains tight: Q1 2025 saw vacancy rates around 6.1%, with key submarkets like downtown and Ankeny under 3%, while new deliveries were minimal—only ~55,000 ft²—highlighting supply constraints amid strong demand.([colliers.com](https://www.colliers.com/en/research/des-moines/q1-2025-des-moines-industrial-research-report?utm_source=openai))
Non‑residential build‑out costs in Des Moines vary by project type and complexity. Retail fit‑outs, office renovations, and ground‑up construction each fall into distinct cost bands, with mid‑rise and high‑rise projects commanding higher per‑square‑foot budgets. Site conditions, utility access, and permit complexity can significantly influence total project cost.([happecommercial.com](https://happecommercial.com/your-guide-to-commercial-construction-in-des-moines-what-to-expect-in-2025/?utm_source=openai))
Trade labor in Des Moines typically commands a city premium of 5–10% over rural rates due to higher living costs and competition for skilled workers.([busybuildersiowa.com](https://busybuildersiowa.com/iowa-home-building-costs-2025-your-complete-guide-to-pricing-and-savings/?utm_source=openai)) Concrete contractor labor rates in 2025 range from entry‑level to highly experienced tiers, reflecting the need to budget accurately by trade and experience level.([countbricks.com](https://www.countbricks.com/post/2025-concrete-contractors-des-moines-labor-rates?utm_source=openai)) Wage premiums for construction workers remain elevated, with non‑residential construction premiums around 27% as of early 2025.([equipmentworld.com](https://www.equipmentworld.com/market-pulse/article/15746353/4-construction-trends-worth-watching-in-2025?utm_source=openai))
Equipment rental rates have risen in 2025, with general equipment up 5–8% and specialty machinery—such as large excavators, cranes, and aerial lifts—up 10–12% in tight markets.([constructioncostaccounting.com](https://www.constructioncostaccounting.com/post/2026-construction-bidding-material-labor-cost-trends-to-price-jobs-profitably?utm_source=openai)) Fuel costs remain a key variable, with diesel averaging in the high‑single‑dollar range per gallon.([constructioncostaccounting.com](https://www.constructioncostaccounting.com/post/2026-construction-bidding-material-labor-cost-trends-to-price-jobs-profitably?utm_source=openai))
Des Moines continues to grow, with strong population and rental demand driving multifamily development, though vacancy rates have risen modestly.([linkedin.com](https://www.linkedin.com/pulse/5-des-moines-multifamily-market-trends-2025-dan-dempsey-72rxc?utm_source=openai)) The city is also pursuing large‑scale redevelopment, including block‑level housing renewal and downtown adaptive‑reuse, which may influence permitting timelines and cost structures.([axios.com](https://www.axios.com/local/des-moines/2025/02/13/redeveloping-blocks-house-eminent-domain-czb?utm_source=openai))
