As the BD+C editorial team wrapped up work on the 42nd annual Giants 300 report in late June, a number of intriguing industry trends and themes bubbled to the surface. Some are new to us, others simply confirmed our original notions.
The Giants 300 report agglomerates financial data and business dealings from the nation’s largest architecture, engineering, and construction firms (a record-number 480 firms submitted data this year). The AEC “Giants” are a powerful group. Collectively, they represent 60-80% of all design and construction work completed in the nonresidential buildings market in a given year, depending on the building sector and discipline.
Compiling the Giants 300 report gives BD+C editors a unique, bird’s-eye view of the market. Based on the 2018 report, we’ve identified five emerging trends that are likely to transform the construction market in the near future:
1. Offsite construction is here to stay. Once a novelty, offsite construction is taking hold across the industry, as labor shortages persist, the Lean movement grows, and tech-based workflows become prevalent. Major GCs are moving toward manufacturing-based operations, and select owners are requiring prefab on projects.
2. Silicon Valley is eyeing AEC. Billions in venture capital and strategic funding are flooding the AEC market, as nontraditional industries (especially tech) see dollar signs in the transformation of this antiquated, low-margin industry. A Built Worlds report identified 25 VC funds, strategic funds, and accelerators actively targeting AEC. The industry’s new darling, Katerra, nabbed a whopping $865 million from SoftBank. There’s plenty more to come.
3. AI adoption is on the horizon. BD+C has reported on a host of early AI-tech adopters in the AEC market, including Mortenson Construction and WeWork. With the rise of “off-the-shelf” AI solutions, rampant adoption of AI is near. A recent McKinsey report found use cases for AI across the entire project lifecycle.
4. Data is the bottleneck. If tools like AI and AR/VR are the race cars, then data is the fuel—and the industry has a fuel crisis. Experts cite multiple reasons for the data deficit: the siloed nature of AEC, timeliness of the data, “fuzzy” data, and questions about who owns and controls the data. Until the industry can solve its data bottleneck, AEC firms will have a difficult time realizing the full potential of tech tools.
5. Smart buildings are the new green. Prediction: Within seven years, the U.S. market will have a “smart certified” designation, and the label will be as prominent as green/sustainability, health/wellness, and resiliency. Why? Because smart buildings are highly marketable, owner friendly, productivity focused, and resource efficient.
Download BD+C’s report, “Commercial Construction Market Trends: 2018 and Beyond,” here.
Related Stories
Giants 400 | Oct 6, 2022
Top 90 Healthcare Sector Engineering + EA Firms for 2022
Jacobs, AECOM, WSP, and IMEG Corp. head the ranking of the nation's largest healthcare sector engineering and engineering/architecture (EA) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report. Note: This ranking factors all healthcare sector work, including hospitals, outpatient facilities, and medical office buildings.
Giants 400 | Oct 6, 2022
Top 170 Healthcare Sector Architecture + AE Firms for 2022
HDR, CannonDesign, HKS, and Stantec top the ranking of the nation's largest healthcare sector architecture and architecture/engineering (AE) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report. Note: This ranking factors all healthcare sector work, including hospitals, outpatient facilities, and medical office buildings.
Multifamily Housing | Oct 5, 2022
Co-living spaces, wellness-minded designs among innovations in multifamily housing
The booming multifamily sector shows no signs of a significant slowdown heading into 2023. Here is a round up of Giants 400 firms that are driving innovation in this sector.
Laboratories | Sep 12, 2022
Lab space scarcity propels construction demand in life sciences sector
In its 2021 Life Sciences Real Estate Outlook, JLL predicted that access to talent would be a primary concern for an industry sector that had been growing by leaps and bounds. A year later, talent still guides real estate decisions. But market conditions of a different sort were cooling the biotech field: namely, investors that have soured on startups which underperformed after going public. What this means for new construction and renovation going forward is unpredictable, as the drivers behind life sciences’ surge are still palpable.
Giants 400 | Sep 9, 2022
Top 25 Casino Contractors + CM Firms for 2022
The Yates Companies, W.E. O'Neil Construction, Alberici-Flintco, and PCL Construction Enterprises top the ranking of the nation's largest casino contractors and construction management (CM) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report.
Giants 400 | Sep 9, 2022
Top 25 Casino Engineering + EA Firms for 2022
Jacobs, IMEG Corp., EXP, and FEA Consulting Engineers head the ranking of the nation's largest casino engineering and engineering/architecture (EA) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report.
Giants 400 | Sep 9, 2022
Top 20 Casino Architecture + AE Firms for 2022
JCJ Architecture, DLR Group, HBG Design, and Cuningham top the ranking of the nation's largest casino architecture and architecture/engineering (AE) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report.
Giants 400 | Sep 9, 2022
Top 90 Hospitality Sector Contractors + CM Firms for 2022
AECOM, Suffolk Construction, STO Building Group, and The Yates Companies top the ranking of the nation's largest hospitality facilities sector contractors and construction management (CM) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report. Note: This ranking includes revenue for all hospitality facilities work, including casinos, hotels, and resorts.
Giants 400 | Sep 9, 2022
Top 70 Hospitality Sector Engineering + EA Firms for 2022
Jacobs, Jensen Hughes, EXP, and Kimley-Horn head the ranking of the nation's largest hospitality facilities sector engineering and engineering/architecture (EA) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report. Note: This ranking includes revenue for all hospitality facilities work, including casinos, hotels, and resorts.
Giants 400 | Sep 9, 2022
Top 120 Hospitality Sector Architecture + AE Firms for 2022
Gensler, WATG, HKS, and JCJ Architecture top the ranking of the nation's largest hospitality facilities sector architecture and architecture/engineering (AE) firms for 2022, as reported in Building Design+Construction's 2022 Giants 400 Report. Note: This ranking includes revenue for all hospitality facilities work, including casinos, hotels, and resorts.