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
| Feb 7, 2012
Shepley Bulfinch opens San Francisco office
This expansion establishes a physical presence that builds on a portfolio of work for institutional clients on the West Coast, dating to the development of the original Stanford University campus in 1891
| Feb 7, 2012
Thornton Tomasetti opens new office in Denver
The firm, which now has 25 offices internationally, opened the new office to better serve current and potential clients in the western Central region and Mountain States.
| Feb 6, 2012
Slight increase in nonres construction spending expected in 2012, growth projected for 2013
Commercial sector expected to lead real estate recovery.
| Feb 6, 2012
FMI releases 2012 Construction Productivity Report
Downsizing has resulted in retaining the most experienced and best-trained personnel who are the most capable of working more efficiently and harder.
| Feb 6, 2012
Kirchhoff-Consigli begins Phase 2 renovations at FDR Presidential Library and Museum
EYP Architecture & Engineering is architect for the $35 million National Archives Administration project.
| Feb 6, 2012
Batson-Cook announces the appointment of Hall as president
Hall will manage and direct all aspects of the firm’s day-to-day operations. He will be based in Batson-Cook’s Atlanta office.
| Feb 6, 2012
Siemens gifts Worcester Polytechnic Institute $100,000 for fire protection lab renovation
Siemens support is earmarked for the school’s Fire Protection Engineering Lab, a facility that has been forwarding engineering and other advanced degrees, graduating fire protection engineers since 1979.
| Feb 2, 2012
Call for Entries: 2012 Building Team Awards. Deadline March 2, 2012
Winning projects will be featured in the May issue of BD+C.
| Feb 2, 2012
VLK Architects selected for new Cypress, Texas elementary school
The Bridgeland Elementary School will be a new prototype school for the District. Designed to meet the requirements of The Collaborative for High Performance Schools.