Healthy fundamentals in the commercial property market combined with the international economy returning to more traditional growth levels are factoring into a projected increase in growth for the design and construction industry.
Led by the hotel and retail project categories, the commercial sector looks to see the biggest gains in construction spending, with demand for institutional projects increasing at a more moderate level.
The American Institute of Architects’ (AIA) semi-annual Consensus Construction Forecast, a survey of the nation’s leading construction forecasters, is projecting that spending will see a 5.8% increase in 2014, with next year’s projections raised to 8%.
“Since the overall economy is stabilizing, there should be a significant improvement in the outlook for the construction industry that has been recovering at a slow and steady pace the last two years,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “At a more granular level, the surging housing market, growing commercial property values, and declining office and retail vacancies are all contributing to what is expected to amount to a much greater spending on nonresidential building projects.”
Baker continued, “The rosy outlook also contains several concerns for the entire construction industry. Rising construction costs, a shortage of skilled labor, and bank credit standards that have not eased up enough to keep pace with the strong demand for construction financing are all serious challenges to sustained growth in the coming years.”
Here is AIA's 2014 and 2015 forecast by sector:
About the AIA Consensus Construction Forecast Panel
The AIA Consensus Construction Forecast Panel is conducted twice a year with the leading nonresidential construction forecasters in the United States including, McGraw Hill Construction, Wells Fargo Securities, IHS-Global Insight, Moody’s economy.com, Reed Business Information, Associated Builders & Contractors and FMI. The purpose of the Consensus Construction Forecast Panel is to project business conditions in the construction industry over the coming 12 to 18 months. The Consensus Construction Forecast Panel has been conducted for 15 years.
About The American Institute of Architects
Founded in 1857, members of the American Institute of Architects consistently work to create more valuable, healthy, secure, and sustainable buildings, neighborhoods, and communities. Through nearly 300 state and local chapters, the AIA advocates for public policies that promote economic vitality and public well being. Members adhere to a code of ethics and conduct to ensure the highest professional standards. The AIA provides members with tools and resources to assist them in their careers and business as well as engaging civic and government leaders, and the public to find solutions to pressing issues facing our communities, institutions, nation and world. Visit www.aia.org.
Related Stories
Giants 400 | Oct 5, 2023
Top 175 Healthcare Architecture Firms for 2023
HDR, HKS, CannonDesign, Stantec, and SmithGroup top BD+C's ranking of the nation's largest healthcare sector architecture and architecture/engineering (AE) firms for 2023, as reported in Building Design+Construction's 2023 Giants 400 Report. Note: This ranking includes revenue related to all healthcare buildings work, including hospitals, medical office buildings, and outpatient facilities.
Biophilic Design | Oct 4, 2023
Transforming the entry experience with biophilic design
Vessel Architecture & Design's Cassandra Wallace, AIA, NCARB, explores how incorporating biophilic design elements and dynamic lighting can transform a seemingly cavernous entry space into a warm and inviting focal point.
Regulations | Oct 4, 2023
New York adopts emissions limits on concrete
New York State recently adopted emissions limits on concrete used for state-funded public building and transportation projects. It is the first state initiative in the U.S. to enact concrete emissions limits on projects undertaken by all agencies, according to a press release from the governor’s office.
Architects | Oct 4, 2023
Architects and contractors underestimate cyberattack risk
Design and construction industry firms underestimate their vulnerability to cyberattacks, according to a new report, Data Resilience in Design and Construction: How Digital Discipline Builds Stronger Firms by Dodge Construction Network and content security and management company Egnyte.
Luxury Residential | Oct 2, 2023
Chicago's Belden-Stratford luxury apartments gets centennial facelift
The Belden-Stratford has reopened its doors following a renovation that blends the 100-year-old building’s original architecture with modern residences.
Giants 400 | Oct 2, 2023
Top 30 Data Center Architecture Firms for 2023
Corgan, HDR, Gensler, Page Southerland Page, and HED top BD+C's ranking of the nation's largest data center sector architecture and architecture/engineering (AE) firms for 2023, as reported in Building Design+Construction's 2023 Giants 400 Report.
Market Data | Oct 2, 2023
Nonresidential construction spending rises 0.4% in August 2023, led by manufacturing and public works sectors
National nonresidential construction spending increased 0.4% in August, according to an Associated Builders and Contractors analysis of data published today by the U.S. Census Bureau. On a seasonally adjusted annualized basis, nonresidential spending totaled $1.09 trillion.
K-12 Schools | Oct 2, 2023
4 design strategies for successful K-12 magnet schools
Clark Nexsen's Donna Francis, AIA, Principal, and Becky Brady, AIA, share four reasons why diverse K-12 magnet schools require diverse design.
Architects | Sep 28, 2023
Nashville architecture firm ESa adds 14 principals
ESa has announced that 14 new principals have been added to the firm’s leadership. “As ESa continues to grow, we are excited to celebrate our newest ESa principals. These individuals embody the characteristics of a quality leader and have shown great leadership in client and team member relationships, project management and mentoring roles,” said Kevin Harney, ESa vice president and principal.
Construction Costs | Sep 28, 2023
U.S. construction market moves toward building material price stabilization
The newly released Quarterly Construction Cost Insights Report for Q3 2023 from Gordian reveals material costs remain high compared to prior years, but there is a move towards price stabilization for building and construction materials after years of significant fluctuations. In this report, top industry experts from Gordian, as well as from Gilbane, McCarthy Building Companies, and DPR Construction weigh in on the overall trends seen for construction material costs, and offer innovative solutions to navigate this terrain.
