Daniel sent us this one — he's been thinking about something that sounds like it should be obvious. Stack more floors on the same piece of land, house more people, bring costs down per person. Basic economies of scale. But instead, high-rise residential buildings end up being the most expensive way to build housing per square foot, which pushes them into luxury-only territory. The question is whether that's fixable — what's actually driving those costs, and whether any combination of technology or policy could ever make a sixty-story apartment building the most cost-efficient way to house a lot of people.
This is one of those questions where the physical intuition just betrays you completely. You look at a tower and think, well, you're repeating the same floor plan over and over — how expensive can it be? But a building isn't just a stack of floor plates. It's a system that has to fight wind, move people vertically, pump water up, and not kill anyone if there's a fire. And every one of those problems gets harder faster than the building gets taller.
If high-rises are so expensive, why do we keep building them?
That's exactly the right place to start. Because the answer requires splitting land costs from construction costs — and most public debate mashes them together. If land is cheap, you build out. If land is expensive, you build up. But the construction cost per square foot rises with height, and the question is whether land savings ever catch up.
The answer seems to be — sometimes, but only in a pretty narrow band.
Let me frame the scope here, because the numbers shift dramatically depending on what you're building. We're talking about residential high-rises — twelve stories and up. Office towers are a different animal entirely. They have different floor plate requirements, different mechanical loads, different economics. And we're focusing on construction and maintenance costs, not land costs, which vary so much by city that they'd swamp the whole conversation.
The episode is really about the structural cost disadvantages of height, and whether those disadvantages are baked into physics or are just the way we happen to build things right now.
And we'll do this in three parts. First, the baseline cost drivers that make any high-rise more expensive than a mid-rise. Second, the nonlinear escalators that kick in when buildings get extremely tall — fifty, sixty, eighty stories. And third, the scenarios where the economics could actually flip.
Let's start with the basics. What actually makes a high-rise more expensive than a mid-rise, floor by floor?
The first thing to understand — and this is where most coverage gets it wrong — is that above about ten stories, gravity stops being your main problem. Wind takes over.
Which sounds wrong, because the building obviously still weighs the same.
Right, but gravity is predictable. It points down, it's constant, and engineers have been handling it since the Romans. Wind is dynamic. It comes from different directions, it creates suction on one side and pressure on the other, it makes buildings sway. And the wind load on a building doesn't increase linearly with height — it increases roughly with the square of the wind speed, and wind speed increases with height above ground.
A forty-story building isn't dealing with four times the wind of a ten-story building. It's dealing with something much worse.
And to resist those lateral forces, you need what's called a lateral force-resisting system — shear walls, moment frames, outriggers. These are essentially giant vertical braces that stiffen the building against sway. In a six-story building, your structural steel and rebar costs are almost entirely about holding weight up. In a twenty-story building, fifteen to twenty-five percent of your structural material is there just to fight wind.
That's a fifteen to twenty-five percent cost premium before you even get to elevators or fire safety.
And it compounds. The taller you go, the more of your structure is devoted to lateral resistance rather than gravity support. Brian Potter, who writes the Construction Physics newsletter — which is basically the Bible for this topic — he's documented how, in a supertall building, the structural system can be forty to fifty percent of total construction cost, versus maybe twenty percent for a mid-rise.
That's the structural piece. What about moving people up and down?
Elevators are where the economics get really punishing, and most people don't appreciate how much space they eat. In a twenty-story building, the elevator core — that's the shafts, the lobbies, the machine rooms — consumes about three to five percent of each floor plate. That's dead space you can't rent or sell.
Which is already significant.
Then you hit thirty stories, and you need multiple elevator banks. Because nobody wants to stop at thirty floors on the way up. So you split your elevators into zones — one bank serves floors one through fifteen, another serves sixteen through thirty. And you need a sky lobby where people transfer between banks.
A whole floor that's just an elevator waiting room.
And in a sixty-story building, the core can consume twenty-five to thirty percent of each floor plate. A quarter of your building is elevators and stairwells and mechanical shafts. And the hardware itself — a single high-speed elevator for a tall building runs two to four million dollars. You might need a dozen of them.
You're paying millions for machines that reduce your sellable space. It's a double penalty.
The maintenance on those elevators is ongoing. Cables need replacement, motors need servicing, control systems get obsolete. In a fifty-story residential building, you're looking at annual elevator maintenance contracts in the hundreds of thousands of dollars.
What's the third big one?
Fire and life safety is where the building code really starts to bite. In the US, the magic number is seventy-five feet — roughly seven stories. Below that, you can get away with a single stairwell in many jurisdictions, basic sprinkler systems, and relatively simple fire access. Above that, everything escalates.
You need a second stairwell, for one thing — which means more core space eaten up. You need pressurized stairwells so smoke doesn't fill them during a fire. You need standpipe systems — those are the vertical pipes firefighters connect to — with fire pumps powerful enough to push water up to the top floors. You need emergency generators to run those pumps and the elevator recall systems and the stairwell pressurization fans if grid power fails.
All of that adds up.
It adds about five to fifteen dollars per square foot to construction costs. Which sounds modest until you're building a four-hundred-unit tower at a thousand square feet per unit. Now you're talking millions of dollars just for fire safety systems.
These aren't things you can value-engineer away. The code mandates them.
And the code is written in blood, as the saying goes. These requirements exist because fires in tall buildings are genuinely more dangerous — longer evacuation times, harder firefighter access, more potential victims. So the cost is real and non-negotiable.
What about what's under the building? Foundation costs seem like they'd be a factor.
Foundations are interesting because they're actually one of the few areas where taller buildings get a per-unit advantage. Here's why. Deep foundations — piles, caissons, shoring for basements — can cost twenty to forty dollars per square foot of building footprint. And that cost is largely fixed regardless of how many floors you stack above.
The more floors you have, the more you spread that fixed cost.
For a five-story building, foundation costs might be eight dollars per square foot of floor area. For a forty-story building, maybe two dollars. So foundations actually favor height — it's one of the few things that does.
It's clearly not enough to offset everything else.
Not even close. Which brings me to the fifth baseline cost driver, and it's one that doesn't show up in materials spreadsheets — construction logistics. Building a ten-story building is a different operation from building a forty-story building, even if the floor plates are identical.
Because everything takes longer to get where it's going.
A tower crane has to lift materials higher. Concrete has to be pumped farther — and pumping concrete vertically is a whole engineering challenge, because the pressure at the bottom of the column becomes enormous. You need higher-pressure pumps, more robust pipelines. And then there's the human factor. The University of British Columbia's Centre for Interactive Research on Sustainability did a study in twenty twenty-three that found crew productivity drops ten to fifteen percent for every ten stories above ground level.
Wait — per ten stories?
Per ten stories. So by the time you're on the fortieth floor, your crews are thirty to forty-five percent less productive than they were at ground level.
Because they're spending more time waiting for materials, or because the work itself is harder?
Material transport times increase. Weather exposure gets worse — wind is stronger, it's colder. Safety requirements are more stringent, which slows everything down. And just the psychological fatigue of working at height affects productivity. So your labor costs per square foot are climbing as the building rises.
That's a brutal compounding effect. You're paying more for materials, more for systems, and more for labor to install them slower.
Construction loans are expensive — interest rates on commercial construction lending have been running at seven to nine percent lately. A twenty-story building might take eighteen months to top out. A sixty-story building takes thirty to thirty-six months. That extra year and a half of interest payments, insurance, and security adds fifteen to twenty-five percent to the total project cost.
Let me try to put some real numbers on this. What does a forty-story residential tower actually cost to build compared to a ten-story building?
The Rider Levett Bucknall data from twenty twenty-five shows a forty-story residential building in North America running four hundred to six hundred dollars per square foot. A ten-story building in the same market, same quality level, runs two hundred fifty to three hundred fifty. That's a sixty to seventy percent premium per square foot.
For the same basic product — places where people sleep and eat and watch television.
Same product, same finishes. The difference is entirely in structure, vertical circulation, fire safety, and construction logistics. And that premium is what forces developers into the luxury market. You cannot build a four-hundred-dollar-per-square-foot building and rent units at affordable rates — the math simply doesn't work.
Which creates the self-fulfilling prophecy. High-rises are expensive, so they're built as luxury towers, so people associate high-rises with luxury exclusivity, and nobody even tries to build affordable ones.
And that's before we get to the really tall buildings. Those baseline costs are bad enough, but they get worse as you go higher. The cost curve isn't linear — it's exponential. Here's where things get really interesting.
Alright, walk me through it. What changes when you go from forty stories to sixty or eighty?
The first thing is wind engineering becomes completely dominant. At forty stories, you're already designing for lateral loads. At sixty stories, you're essentially building a giant aerodynamic structure that happens to contain apartments.
What does that actually mean in practice?
It means you need tuned mass dampers or sloshing dampers. These are massive weights — sometimes hundreds of tons — suspended near the top of the building that swing in opposition to the building's movement, counteracting sway. They cost five to ten million dollars per building. You also need more complex aerodynamic shaping — tapering the building as it rises, adding setbacks, sometimes cutting openings through the structure to let wind pass through rather than pushing against it.
Which must reduce the usable floor area.
It reduces floor plate efficiency by ten to twenty percent. So not only are you paying more for the structural solutions, you're getting less sellable space on every floor. The wind engineering penalty is a double hit — higher costs and lower revenue.
The elevator problem gets worse too.
At sixty stories, the elevator core can consume a quarter to nearly a third of each floor plate. You need multiple sky lobbies. You might need double-decker elevators, which are fantastically expensive to install and maintain. And you need express elevators that skip thirty floors at a time — those require bigger motors, stronger cables, more sophisticated control systems.
You're building a vertical transit system with a building wrapped around it.
That's actually a good way to think about it. At extreme heights, the building is almost an afterthought — the real engineering challenge is moving people and air and water and electricity vertically over distances that would be challenging even horizontally.
What about the façade? I'd imagine wind pressure at sixty stories is intense.
Wind pressures at the top of a sixty-story building can be two to three times higher than at ground level. Your curtain wall system needs thicker glass, more robust framing, stronger anchors. And installation is much more complex — you can't just use a boom lift, you need specialized rigging and safety systems.
What does that cost?
Structural glazing for a sixty-plus-story tower runs eighty to a hundred twenty dollars per square foot. A low-rise curtain wall might cost forty to sixty. And you're paying that premium over the entire building envelope — which for a slender tower might be a hundred fifty thousand square feet or more.
That's millions in glass alone.
Then there are mechanical floors. Every twenty to thirty stories, you need a dedicated floor for HVAC equipment, water pumps, electrical transformers. These floors are essentially unrentable — they add two to three percent to total building cost without generating any revenue.
Because you can't just stick the air handlers on the roof and call it a day.
Not at sixty stories. The pressure drops in vertical ducts become too large. You need intermediate mechanical floors to boost air pressure, pump water in stages, step down electrical voltage. Water is a particularly good example — if you try to pump water directly to the top of a sixty-story building from the basement, the pressure at the bottom of the riser would be enormous, requiring incredibly thick pipes and creating burst risks. So you pump to a mechanical floor at level twenty, store it in tanks, pump to level forty, store it again, and so on.
The building is drinking its own water in stages, like a giraffe bending its neck.
That's a remarkably apt comparison. Giraffes actually have a series of valves in their carotid arteries to manage blood pressure when they lower their heads. A supertall building has analogous systems.
What about once the building is actually occupied? The costs don't stop.
The operational costs are where the long-term economics really diverge from mid-rise buildings. Energy is the biggest one. High-rises have higher HVAC loads because of something called the stack effect — warm air rises, creating pressure differentials between floors that drive infiltration. Cold air gets sucked in at the bottom, warm air escapes at the top. A forty-story building uses twenty to thirty percent more energy per square foot than a ten-story building in the same climate.
Everything is more expensive at height. Façade cleaning for a fifty-story building — the window washing alone can cost fifty to a hundred dollars per window per cleaning. Elevator maintenance contracts for tall buildings are substantially more expensive because the equipment is more complex and the consequences of failure are more severe. Window replacement requires specialized crews and equipment.
Insurance too, I'd imagine.
Insurance premiums for high-rise residential buildings run thirty to fifty percent higher per unit than for mid-rise buildings. Fire risk is higher — not because fires are more likely, but because evacuation is more complex and the potential liability is greater. If a fire breaks out on the fortieth floor of a sixty-story building, you're evacuating hundreds of people down dozens of flights of stairs. That's a nightmare scenario for insurers.
All of this is baked in before you even pick out countertops.
That's the misconception I really want to nail down. When people see luxury high-rise apartments with marble bathrooms and Sub-Zero refrigerators, they assume the luxury finishes are what makes them expensive. But the finishes are a rounding error. The structural system, the elevators, the fire safety, the mechanical systems — those are the cost drivers. The marble is just what you put in because at four hundred dollars a square foot, you have to target buyers who can afford it.
The luxury finishes are a consequence, not a cause.
And this is why the "just build taller" approach to housing affordability is so misguided. If you don't address the underlying cost structure, taller buildings simply produce more expensive units. The mechanism doesn't reverse itself just because you add floors.
Let's put some real-world examples on this. What does the data show when we compare cities that have taken different approaches?
The Vancouver versus Paris comparison is instructive. Vancouver builds what are called point towers — thirty to forty stories on small footprints, with large setbacks between them. Construction costs run four hundred to five hundred dollars per square foot. Paris builds mid-rise blocks — six to eight stories, continuous street frontages. Construction costs run two hundred fifty to three hundred fifty dollars per square foot.
Vancouver's land costs are astronomical.
And that's the only reason the math works at all. The land cost savings partially offset the construction premium. But even then, Vancouver's housing is among the least affordable in North America. The towers haven't solved the problem.
What about Singapore? They've taken a very different approach to public housing.
Singapore's Housing and Development Board — the HDB — is the best counterexample to the idea that tall buildings are necessary for density. HDB builds ten to twenty-story slab blocks at a hundred fifty to two hundred dollars per square foot. Private forty-plus-story condos in Singapore cost four hundred to six hundred dollars per square foot. That's a two to three times premium for height.
Singapore is one of the densest cities on earth.
One of the densest, and they achieve that density almost entirely with mid-rise construction. Their tallest public housing block is forty stories, and it was a pilot project that hasn't been replicated. The economics didn't work for affordable housing.
What about the extreme case — the Burj Khalifa?
The Burj Khalifa is the reductio ad absurdum of high-rise economics. The residential floors cost roughly fifteen hundred dollars per square foot to build. Dubai's mid-rise apartments cost about three hundred. The land cost per unit was actually lower for the Burj — desert land is cheap — but construction costs overwhelmed the savings completely.
You could have built five mid-rise apartment buildings for the cost of one Burj Khalifa's worth of residential space.
And housed more people more comfortably. But the Burj wasn't built to be efficient housing. It was built to be the tallest building in the world. That's a completely different objective function.
Which brings us to the central paradox. The skyscraper was never about efficiency. It was about prestige, land speculation, and engineering ego.
The modern skyscraper emerged in Chicago and New York in the late nineteenth century not because it was the cheapest way to build, but because land values in the Loop and lower Manhattan were so astronomical that developers were willing to pay the height premium. And even then, the early skyscrapers were office buildings, not residential. The economics were different — office tenants would pay a premium for a prestigious address, and floor plate efficiency mattered less.
The question becomes — if we strip away the ego and the prestige and the speculation, can we make the numbers work for regular housing?
That's exactly the right pivot. So if the economics seem stacked against tall buildings, is there any way to fix them? Let's look at three things that could change the math.
Alright, give me the first one.
The sweet spot. For cost-efficient high-rise housing, the optimal range appears to be twelve to twenty-five stories. Below twelve, you lose too much land-use efficiency — you're not getting enough units per acre to justify urban land costs. Above twenty-five, the cost escalators start to dominate and you're pushed into luxury territory. Cities that want density without luxury-only outcomes should be zoning for this range.
Twelve to twenty-five stories. That's a pretty specific band.
It varies somewhat by market — in cities with extremely high land costs like New York or Hong Kong, the sweet spot might extend to thirty or thirty-five stories. In cheaper markets, it might top out at fifteen. But the principle holds: there's a range where height makes economic sense, and beyond that range, you're paying for engineering rather than housing.
What's the second lever?
Modular construction and prefabrication. This is where the technology could shift the curve. Companies like Plant Prefab and several European firms have demonstrated that prefabricated bathroom pods, façade panels, and even entire room modules can reduce on-site labor costs by twenty to thirty percent for high-rise construction.
Because you're building in a factory instead of in the sky.
Factory production eliminates the productivity losses from working at height. It reduces weather delays. It improves quality control. And it shortens the construction schedule, which reduces carrying costs. If this technology matures — and it's still early — it could make thirty to forty-story buildings cost-competitive with ten to twenty-story ones built conventionally.
Katerra tried this and imploded spectacularly.
Katerra raised something like two billion dollars and went bankrupt in twenty twenty-one. But their failure wasn't about the technology being unworkable — it was about trying to vertically integrate everything simultaneously while growing at an insane pace. The underlying approach of prefabrication for high-rises is sound, and smaller companies are advancing it more carefully.
The modular approach could work, but it needs to be implemented by companies that aren't trying to disrupt the entire construction industry in eighteen months.
It's a classic case of the technology being sound but the business model being reckless. The third lever is policy. There are several regulatory changes that could shift the economics meaningfully.
Floor area ratio limits are a big one. Many cities cap how much floor area you can build on a given lot. If you relax those limits to allow larger floor plates, you reduce the core-to-usable-area ratio. A wider building has proportionally less space lost to elevators and stairwells. It's simple geometry.
Because the core stays roughly the same size regardless of the floor plate dimensions.
A fat building is more efficient than a skinny one. But many zoning codes effectively force slender towers through setback requirements and FAR caps. Relaxing those would make high-rises cheaper per square foot.
Single-stair buildings. Seattle proposed a building code reform in twenty twenty-five that would allow single-stair residential buildings up to twelve stories. Currently, most North American codes require two stairwells above three or four stories. A single stairwell frees up five to ten percent more usable floor area.
The fire safety concern?
The argument is that modern sprinkler systems, pressurized stairwells, and fire-rated construction make the second stairwell redundant for buildings of moderate height. Many European countries allow single-stair buildings up to much greater heights than North America, and their fire safety records are comparable or better.
It's not a safety tradeoff — it's a regulatory difference.
The data suggests that. And then there's density bonusing — cities can tie height allowances to affordability requirements. You want to build forty stories? Fine, but twenty percent of the units have to be affordable at eighty percent of area median income. That uses the market's desire for height to cross-subsidize affordable units.
Though that only works if the height premium isn't so large that the affordable units become impossible to subsidize.
And that's the tension. If the cost premium for going from twenty to forty stories is sixty percent, no amount of density bonusing can make those upper-floor units affordable. The math breaks.
Policy can help at the margins, but it can't defeat physics.
Physics and geometry. Which brings me to the actionable piece of this. What should people who care about housing affordability actually push for?
Push for cost-benefit analyses that compare total lifecycle costs per resident — construction plus operations plus maintenance — not just cost per square foot. The current metrics are misleading. A high-rise might look comparable on a per-square-foot basis when you factor in land, but when you add thirty years of energy costs, elevator maintenance, and façade repairs, the mid-rise almost always wins.
The public debate is using the wrong yardstick.
And developers have no incentive to correct this, because they're not the ones paying the long-term operating costs. The condo board or the rental operator is. So the construction cost premium gets obscured by the land cost savings, and nobody looks at the total picture.
What's the second thing?
If you're involved in urban planning or development, advocate for zoning that encourages the twelve-to-twenty-five-story sweet spot rather than either sprawl or supertalls. Many cities have a missing middle — they allow single-family homes or fifty-story towers, with nothing in between. That's how you get luxury towers surrounded by exclusionary low-rise neighborhoods.
The worst of both worlds.
The density debate is often framed as a binary — sprawl versus towers. But the most efficient, most affordable urban form in most contexts is the mid-rise, high-coverage fabric. Paris, Barcelona, Tokyo — these are not cities of supertalls. They're cities of six to twelve-story buildings covering most of the land area. And they're among the densest, most livable cities on earth.
Tokyo being the example that really breaks the American brain, because people picture it as a city of skyscrapers, but it's mostly mid-rise.
Tokyo's success with density comes almost entirely from mid-rise construction. The skyscrapers are concentrated in a few business districts. The residential neighborhoods are overwhelmingly six to twelve-story buildings on small lots, with very high lot coverage. That's how you get density without the cost premium.
Alright, let's look forward. What are the open questions here?
The biggest one is materials. Cross-laminated timber is starting to be used for mid-rise buildings, and there are proposals for timber high-rises up to eighteen stories or more. Timber is lighter than concrete and steel, which reduces foundation costs and seismic loads. If the technology matures and building codes adapt, it could shift the economics.
Carbon fiber reinforcement?
Carbon fiber reinforced concrete is another potential game-changer. It's much lighter than steel-reinforced concrete, which means less material overall, smaller foundations, and potentially simpler structural systems for tall buildings. But it's still expensive and not widely used outside of specialized applications.
These are real technologies, but they're not ready to reshape the market yet.
The next ten years will be decisive. If construction costs continue to rise faster than land costs — and they have been, with high-rise construction costs rising eight percent year over year for the past three years according to the RLB Crane Index — then high-rises will become even more of a niche product. But if modular construction and policy reforms take hold, we might see a new generation of affordable high-rises in cities like Toronto, London, and São Paulo.
The question is whether we can retrofit the skyscraper's ambition for a housing-first agenda.
The skyscraper was born from ego and land speculation. It was never about efficiently housing people. The Burj Khalifa, Central Park Tower, the pencil towers of Fifty-Seventh Street — these are monuments to capital, not solutions to housing crises.
Central Park Tower — what did that cost?
Ninety-eight stories, a hundred seventy-nine units, estimated construction cost of one point two billion dollars. That's roughly six point seven million dollars per unit, excluding land. You could build an entire mid-rise apartment building for the cost of one unit in that tower.
That's the world's tallest residential building. It's a sculpture people sleep in.
A sculpture people sleep in. I'm going to use that.
Where does this leave us? The twelve-to-twenty-five-story sweet spot seems like the actionable takeaway. Modular construction could push that higher. Policy reforms could help at the margins. But the fundamental physics of wind, gravity, and vertical transport aren't going anywhere.
And I think the deeper insight is that the question itself — "can high-rises be the most cost-efficient way to house people?" — is framed around the wrong objective. Efficiency in housing isn't about maximizing units per square foot of land. It's about maximizing affordable, livable homes per dollar of total lifecycle cost. And on that metric, the mid-rise wins almost everywhere.
The skyscraper looks efficient if you only count land. Once you count everything else, it's the most expensive way to put a roof over someone's head.
Which doesn't mean we should never build tall. There are places where land costs justify it — central London, Hong Kong, parts of Manhattan. And there are non-economic reasons to build tall — cultural significance, architectural ambition, the sheer joy of a beautiful tower on a skyline. But as a housing strategy, as a way to solve affordability crises, the high-rise is a distraction. The real work is in the mid-rise fabric.
That's a good place to land. The skyscraper isn't going away, but it's not going to save us either.
Now, Hilbert's daily fun fact.
Hilbert: In the nineteen seventies, marine biologists studying octopus chromatophores off New Zealand's South Island discovered that the pigment granules responsible for color change contain a unique protein complex — reflectin — whose amino acid sequence includes an unusually high proportion of aromatic residues, giving it the highest refractive index of any known biological material at the time.
Octopuses are basically walking optical instruments.
With better chemistry than most labs.
This has been My Weird Prompts. If you want more episodes, you can find us at myweirdprompts dot com or wherever you get your podcasts. Thanks to our producer Hilbert Flumingtop. We'll be back next week.
