Gilbane Building Company today announces the publication of the Spring 2013 edition of Construction Economics – Market Conditions in Construction. Based on an array of economic data, construction starts, and material cost trends, the data is the most positive the company has seen in recent years.
“We are in a growth period that by all leading indicators seems here to stay. From 2006 to 2010, as work declined, we saw the largest decline of margins in recent history. In 2011 that trend began to reverse slightly” says Ed Zarenski, the report’s author and a 40-year veteran of the construction industry. “I expect the positive growth to continue.”
According to the report, the monthly rate of construction spending is up 20% in 24 months and increased in 18 of the last 24 months, which is a good leading indicator for new construction work in Q3-Q4 2013.
Other highlights include:
- Residential spending will take the lead in 2013, nonresidential spending will lag.
- Public spending will decline. Private spending will lead the charge in 2013.
- As spending continues to increase, even moderate growth in activity will allow contractors to pass along more material costs and increase margins. When activity picks up in all sectors, escalation will begin to advance rapidly.
- Predicted spending growth of 8.2% for Commercial markets, 5.2% for Office and 2.3% for Healthcare.
Construction jobs grew by 150,000 in the last five months. Just to meet the needs of the predicted residential building expansion, the workforce needs to grow by 750,000 jobs in the next two years, faster than the entire construction workforce has ever grown in history.
Future escalation, in order to support labor growth, materials demand and to capture increasing margins, will be higher than normal labor/material cost growth. Lagging regions may take longer to experience high escalation. Residential escalation will be near the upper end of the range.
This free report and its executive summary are available for download at http://www.gilbaneco.com/economic-report.
About Gilbane, Inc.
Gilbane provides a full slate of construction and facilities-related services – from pre-construction planning and integrated consulting capabilities to comprehensive construction management, close-out and facility management services – for clients across various markets. Marking its 140th year in operation and still a privately held, family-run company, Gilbane has more than 60 office locations around the world. To find out what the next 140 years have in store, visit www.gilbaneco.com.
Related Stories
| Feb 15, 2012
Code allowance offers retailers and commercial building owners increased energy savings and reduced construction costs
Specifying air curtains as energy-saving, cost-cutting alternatives to vestibules in 3,000-square-foot buildings and larger has been a recent trend among consulting engineers and architects.
| Feb 15, 2012
Englewood Construction announces new projects with Destination Maternity, American Girl
Englewood’s newest project for Wisconsin-based doll retailer American Girl, the company will combine four vacant storefronts into one large 15,000 square-foot retail space for American Girl.
| Feb 14, 2012
Angelo State University opens doors to new recreation center expansion
Designed by SmithGroup, the JJR_Center for Human Performance offers enhanced fitness options, dynamic gathering space.
| Feb 14, 2012
SAIC selected for architectural and engineering design services at Lajes Field, Azores
SAIC’s services will include a broad variety of new construction projects and maintenance and repair projects
| Feb 14, 2012
Skanska promotes Aparicio and hires Leintz in Southern California
Aparicio and Leintz are both based in Skanska’s Los Angeles office.
| Feb 14, 2012
The Jackson Laboratory announces Gilbane Building Co. as program manager for Connecticut facility
Gilbane to manage program for new genomic medicine facility that will create 300 jobs in Connecticut.
| Feb 14, 2012
Thornton Tomasetti names Al Hashimi vice president for its Middle East Operations
Al Hashimi is joining the company to help expand Thornton Tomasetti’s business in the region and support clients locally.
| Feb 13, 2012
WHR Architects renovation of Morristown Memorial Hospital Simon Level 5 awarded LEED Gold
Located in the Simon Building, which serves as the main entrance leading into the Morristown Memorial Hospital campus, the project comprises three patient room wings connected by a centralized nursing station and elevator lobby.
| Feb 13, 2012
Center for Sustainable Building Research launches CommercialWindows.org
Resource aims at reducing commercial operating costs and energy consumption.
| Feb 13, 2012
New medical city unveiled in Abu Dhabi
SOM’s design for the 838-bed, three-million-square foot complex creates a new standard for medical care in the region.