FMI released the first-quarter 2012 Construction Outlook Report forecasting a 5% increase in total construction put in place for 2012 compared to 2011, or $826.3 billion. The last time construction put in place was at this level was 2000-2001.
Despite slow growth projections and rising gasoline prices, the GDP is still growing and consumers are still spending, reflected in the Conference Board's Consumer Confidence Index increasing to 70.8 in February compared to 70.4 a year ago. Along with the Federal Reserve's intervention, these factors have served to keep growth slow and inflation in check.
In order for residential construction to achieve the 8 percent increase projected and top $264.4 billion in 2012, a number of factors still have to fall into place:
- Reduction in the current inventory of homes
- Lenders willing to lend on reasonable terms
- Steady improvement in hiring
Projections indicate a 4% increase in nonresidential buildings for 2012, topping $341 billion, with slightly higher growth in 2013 to $361 billion. Nonresidential contractors are facing many of the same problems as residential contractors. In addition, competition is fierce, with low price still the name of the game. Project owners who are ready to restart their building programs are expecting hungry contractors to submit very low bids. One of the keys for growth will be the return of private investment in construction. Additionally, federal, state and local government construction have been dialed back until budgets are in better repair and tax revenues return to levels that are more normal. Research indicates that there are signs this is starting to happen. BD+C
Related Stories
Museums | May 13, 2015
The museum of tomorrow: 8 things to know about cultural institutions in today’s society
Entertainment-based experiences, personal journeys, and community engagement are among the key themes that cultural institutions must embrace to stay relevant, write Gensler's Diana Lee and Richard Jacob.
Industrial Facilities | May 11, 2015
SOM-designed Manufacturing and Design Innovation Institute opens in Chicago
The new space will be a place for academia, industries, and civic bodies to collaborate.
Sponsored | Roofing | May 11, 2015
How architects can tap into the expertise of their metal roof manufacturer, part 2
Here are three things metal roof manufacturers can do to help the architect
BIM and Information Technology | May 10, 2015
How beacons will change architecture
Indoor positioning is right around the corner. Here is why it matters.
Architects | May 10, 2015
Harness the connection between managing risk and increasing profitability, Part 2
In Part 1, we covered taking control of the submittals schedule and managing RFIs. Let’s move on to properly allocating substitutions and limiting change orders.
Architects | May 10, 2015
Harness the connection between managing risk and increasing profitability, Part 1
AE firms need to protect themselves against vague contractual and procedural situations during all phases of the project in order to minimize their liability and exposure to risk, writes AEC industry consultant Steve Whitehorn.
Building Team | May 8, 2015
Construction industry adds 45,000 jobs in April
The construction industry saw an increase in jobs during the month of April after losing approximately 9,000 positions in March.
Building Team | May 8, 2015
Surety bond forms specifically for design-build projects now available
The documents are the first of their kind to be coauthored by designers and builders.
High-rise Construction | May 6, 2015
Parks in the sky? Subterranean bike paths? Meet the livable city, designed in 3D
Today’s great cities must be resilient—and open—to many things, including the influx of humanity, writes Gensler co-CEO Andy Cohen.
Architects | May 5, 2015
How to build 'smart' teams
In today's complex world, there are no simple answers—solutions to our most pressing problems aren't offered in 140 characters. Instead, it takes teams of people to rise to a challenge, resolve issues, and execute on strategy, writes Paladino's Julie Honeywell.
