Autodesk, Inc. (NASDAQ: ADSK) today released the "Construction Outlook 2021: Risks & Opportunities" report, a new study that dives into macro industry trends across five areas including growth, health and construction safety, labor, supply chain and design. As the compounding effects of the global pandemic and resulting economic instability begin to surface, aggregated and anonymized product data from BuildingConnected, a preconstruction solution within Autodesk Construction Cloud, finds that real-time bidding activity has surpassed pre-pandemic levels and reached an all-time high in January 2021.
More than one million owners, general contractors, construction managers and subcontractors use BuildingConnected to answer or request bids. More than five million bid invites are sent out every month on the platform.
Additional key insights detailed in the report derived from aggregated and anonymized BuildingConnected bidding activity, as of March 1, 2021, include:
— While bidding activity was initially on the rise at the beginning of 2020, it dropped roughly 34 percent in the 60 days following March 19 2020, when the first U.S. stay-at-home orders were mandated.
— Bidding activity slowly began to recover between March and October and hit a high for 2020 in November.
— Compared to a three-month pre-pandemic average, total bidding activity was up 15 percent in November and 36 percent in January 2021, with January volume representing an all-time high on the BuildingConnected platform.
— The rate of new projects being added to the platform throughout the past year has remained constant, indicating increased bidding activity may be related to project re-starts, not net-new projects.
"While it's not an indication that we're entirely out of the woods, the real-time bidding data from BuildingConnected suggests that delayed or rescheduled projects may be coming back online," said construction economist Ed Zarenski. "Increased levels of bidding activity, paired with the data that project volume has remained consistent, signals the industry is getting back to work – and doing so quickly."
The 2021 Construction Outlook Report provides insights into construction industry trends in spending, project starts and more
Using internal product data, external sources and industry economists, the Construction Outlook report provides construction professionals with critical information, analysis and actionable insights to stay resilient as the industry begins its journey to recovery. Additional key findings from the report include:
— New starts are up in 2021 but starting backlog in 2022 could slide: While new starts in 2021 are forecast to increase six percent – with a six percent increase in nonresidential projects and a 10 percent increase in non-building infrastructure projects, the starting backlog forecast for 2022 is projected to decrease five percent.
— Nonresidential construction spending will drop in 2021, yet healthcare and commercial retail are projected to rebound in 2022. By October 2021, nonresidential building spending is projected to decrease 20 percent from February 2020, with projected drops of two to three percent each quarter. Nonresidential spend across the board is forecast to hit $411 billion in 2021. In 2022, the healthcare and commercial / retail sectors are expected to grow by three percent and six percent, respectively.
— Transportation, air and rail sectors have been less impacted: Transportation spending is forecasted to grow 10 percent in 2021, due in part to strength in backlog from several multi-billion dollar starts over the past few years. There could also be longer-term positive impacts as the new administration has announced its focus and dedication to the health and resilience of the national transportation system.
— Additional gains will be made in other areas of nonbuilding infrastructure: Forecasted for 2021, certain segments of nonbuilding infrastructure will also see an increase in spend including sewer and water (four percent) and highways and bridges (two percent).
— Total public spending in 2021 is projected to finish at $384 billion, an eight and a half percent increase from 2020. Growth in the residential sector heavily contributes to the gains expected in total spending in 2021. Starting backlog growth is also expected to pick up in 2022, particularly for the commercial, healthcare and transportation sectors.
"In the early days of the pandemic, the construction industry turned to technology to readjust as we facilitated social distancing, implemented jobsite safety guidelines and moved our offices into our homes," Jim Lynch, senior vice president and general manager, Autodesk Construction Solutions. "Now that the industry looks to be picking up and teams are headed back to the jobsite, adopting technology, digitizing workflows and upskilling employees is more important than ever to handle the increased workload. For instance, despite a 40 percent spike in bidding volume, we're seeing that almost 80 percent of teams using BuildingConnected are still able to turn around bids in the industry-standard of seven days. Managing this increase in output with no significant dip in productivity simply would not be possible without the right technology."
Recommendations for improving preconstruction processes and mitigating risk
The report also provides recommendations for companies to help navigate the current industry climate, including:
1. Monitor the burden of project restarts: Defaults tend to rise when the construction industry moves from a period of reduced activity to a period of growth. Moving forward, specialty contractors will need to be tactful in selecting projects, and owners and general contractors will need to evaluate the health of trade partners taking on new work.
2. Qualify trade partners often: The construction market is volatile right now, and traditional annual qualification schedules may need to be conducted more frequently – ideally twice per year.
3. Coordinate the design review process: Reducing change
"As projects quickly begin coming back online, deadlines will be more stringent and every dollar will be scrutinized," said Zac Hays, head of preconstruction, Autodesk Construction Solutions. "The preconstruction process will play an increasingly vital role in mitigating risks, generating and managing critical data and reducing costly rework – which will better position companies to navigate this period of uncertainty with more precision."
The report also offers case studies from Autodesk customers including Chandos, Helm Mechanical, John Moriarty & Associates, EBC, Inc. and CRB. To read the full report, click here.
Related Stories
| Oct 13, 2010
Community center under way in NYC seeks LEED Platinum
A curving, 550-foot-long glass arcade dubbed the “Wall of Light” is the standout architectural and sustainable feature of the Battery Park City Community Center, a 60,000-sf complex located in a two-tower residential Lower Manhattan complex. Hanrahan Meyers Architects designed the glass arcade to act as a passive energy system, bringing natural light into all interior spaces.
| Oct 13, 2010
Community college plans new campus building
Construction is moving along on Hudson County Community College’s North Hudson Campus Center in Union City, N.J. The seven-story, 92,000-sf building will be the first higher education facility in the city.
| Oct 13, 2010
Bookworms in Silver Spring getting new library
The residents of Silver Spring, Md., will soon have a new 112,000-sf library. The project is aiming for LEED Silver certification.
| Oct 13, 2010
County building aims for the sun, shade
The 187,032-sf East County Hall of Justice in Dublin, Calif., will be oriented to take advantage of daylighting, with exterior sunshades preventing unwanted heat gain and glare. The building is targeting LEED Silver. Strong horizontal massing helps both buildings better match their low-rise and residential neighbors.
| Oct 12, 2010
Holton Career and Resource Center, Durham, N.C.
27th Annual Reconstruction Awards—Special Recognition. Early in the current decade, violence within the community of Northeast Central Durham, N.C., escalated to the point where school safety officers at Holton Junior High School feared for their own safety. The school eventually closed and the property sat vacant for five years.
| Oct 12, 2010
Guardian Building, Detroit, Mich.
27th Annual Reconstruction Awards—Special Recognition. The relocation and consolidation of hundreds of employees from seven departments of Wayne County, Mich., into the historic Guardian Building in downtown Detroit is a refreshing tale of smart government planning and clever financial management that will benefit taxpayers in the economically distressed region for years to come.
| Oct 12, 2010
Richmond CenterStage, Richmond, Va.
27th Annual Reconstruction Awards—Bronze Award. The Richmond CenterStage opened in 1928 in the Virginia capital as a grand movie palace named Loew’s Theatre. It was reinvented in 1983 as a performing arts center known as Carpenter Theatre and hobbled along until 2004, when the crumbling venue was mercifully shuttered.
| Oct 12, 2010
University of Toledo, Memorial Field House
27th Annual Reconstruction Awards—Silver Award. Memorial Field House, once the lovely Collegiate Gothic (ca. 1933) centerpiece (along with neighboring University Hall) of the University of Toledo campus, took its share of abuse after a new athletic arena made it redundant, in 1976. The ultimate insult occurred when the ROTC used it as a paintball venue.
| Oct 12, 2010
Owen Hall, Michigan State University, East Lansing, Mich.
27th Annual Reconstruction Awards—Silver Award. Officials at Michigan State University’s East Lansing Campus were concerned that Owen Hall, a mid-20th-century residence facility, was no longer attracting much interest from its target audience, graduate and international students.
| Oct 12, 2010
Gartner Auditorium, Cleveland Museum of Art
27th Annual Reconstruction Awards—Silver Award. Gartner Auditorium was originally designed by Marcel Breuer and completed, in 1971, as part of his Education Wing at the Cleveland Museum of Art. Despite that lofty provenance, the Gartner was never a perfect music venue.