Feeling the effects of the struggling overall U.S. economy, nonresidential construction spending is expected to decrease by 16% in 2009 and drop by another almost 12% in 2010 in inflation-adjusted terms. Commercial projects will see the most significant decrease in activity. In contrast, most institutional building categories are expected to see much more modest declines over this period. These are highlights from the American Institute of Architects (AIA) semi-annual Consensus Construction Forecast, a survey of the nation’s leading construction forecasters.
The AIA Consensus Construction Forecast Panel is conducted twice a year with the leading nonresidential construction forecasters in the United States including, McGraw Hill Construction, Global Insight, Moody’s economy.com, Reed Business Information, the Portland Cement Association, and FMI. The purpose of the Consensus Construction Forecast Panel is to project business conditions in the construction industry over the coming 12-18 months. The Consensus Construction Forecast Panel has been conducted for 11 years.
“While there are some indications that the overall economy is beginning to recover, nonresidential construction activity typically lags behind the rest of the economy,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “Commercial facilities such as hotels, retail establishments and offices will feel the decline most dramatically. The institutional market will fare much better as stimulus funding becomes available for education, healthcare and government facilities.”
Market Segment Consensus Growth Forecasts
“This nonresidential downturn is shaping up to be the deepest decline in nonresidential activity in over a generation,” Baker added. “However, we’re beginning to see some moderation in the trends in design billings at architecture firms, so we hopefully are nearing the bottom of this cycle.”
You must be logged in to post a comment.