ConstructConnect announced today the release of its Q3 2017 Forecast Quarterly Report. The U.S. grand total construction starts growth projection for 2017 over 2016 in ConstructConnect’s Q3 report has been revised down slightly to +4.5% from +4.8%. 2018 remains about the same at +5.9% year over year (y/y). Earlier, it had been estimated at +6.0%.
“The outlook for U.S. construction starts, as calculated by ConstructConnect, has diminished slightly in the short term,” said to Chief Economist Alex Carrick. “Prospects for some private sector project initiations (e.g., in retail) have stalled, while high hopes for an early launch of a much-needed super-infrastructure program, to be sponsored, promoted and perhaps largely financed by the new administration in Washington, have been deflated.”
The forecast which combines ConstructConnect's proprietary data with macroeconomic factors and Oxford Economics econometric expertise, shows the type-of-structure sub-categories among non-residential building starts that will have banner years in 2017:
- Hotels/motels (+38.2%)
- Warehouses (+16.3%)
- Sports stadiums (+47.3%)
- Courthouses (+110.0%)
The 2017 forecast for non-residential building starts was adjusted to -0.8% y/y, versus a flat (0.0%) performance that was expected in Q2’s forecast report. According to the forecast, non-residential building starts in 2018 will rebound to +3.3%, with private office buildings and industrial/manufacturing doing better with less downward drag being exerted by retail and medical projects. The boom in hotel/motel work will begin to lose steam.
Based on a heightened record of ‘actual’ starts through the first half of this year (+25.2%), civil/engineering starts in 2017 were revised upwards to +16.5% y/y from +8.9% in Q2’s report. 2018 growth in this category has also been raised, to +7.4% (from +5.8%).
The forecast includes a few notable high points in the 2017 y/y engineering sub-categories:
- Airports (+38.0%)
- Roads (+14.0%)
- Bridges (+31.0%)
- Power/oil and gas (+30.8%)
The report states among major sub-sectors, residential construction’s 2017 y/y increase has been scaled down to +4.8% from +8.1%. The robust multi-family market of the last several years has been pulling back of late, as rental rates in many regions soared. Single-family starts also stalled, despite a need for substantial growth activity, since they declined so horrendously in the Great Recession. Also, new family formations, specifically among millennials, point to a tremendous potential that for the moment is not being realized.
Related Stories
Industry Research | Oct 3, 2016
Structure Tone survey shows cost is still a major barrier to building green
Climate change, resilience and wellness are also growing concerns.
Industry Research | Sep 27, 2016
Sterling Risk Sentiment Index indicates risk exposure perception remains stable in construction industry
Nearly half (45%) of those polled say election year uncertainty has a negative effect on risk perception in the construction market.
Market Data | Sep 22, 2016
Architecture Billings Index slips, overall outlook remains positive
Business conditions are slumping in the Northeast.
Market Data | Sep 20, 2016
Backlog skyrockets for largest firms during second quarter, but falls to 8.5 months overall
While a handful of commercial construction segments continue to be associated with expanding volumes, for the most part, the average contractor is no longer getting busier, says ABC Chief Economist Anirban Basu.
Designers | Sep 13, 2016
5 trends propelling a new era of food halls
Food halls have not only become an economical solution for restauranteurs and chefs experiencing skyrocketing retail prices and rents in large cities, but they also tap into our increased interest in gourmet locally sourced food, writes Gensler's Toshi Kasai.
Building Team | Sep 6, 2016
Letting your resource take center stage: A guide to thoughtful site selection for interpretive centers
Thoughtful site selection is never about one factor, but rather a confluence of several components that ultimately present trade-offs for the owner.
Market Data | Sep 2, 2016
Nonresidential spending inches lower in July while June data is upwardly revised to eight-year record
Nonresidential construction spending has been suppressed over the last year or so with the primary factor being the lack of momentum in public spending.
Industry Research | Sep 1, 2016
CannonDesign releases infographic to better help universities obtain more R&D funding
CannonDesign releases infographic to better help universities obtain more R&D funding.
Industry Research | Aug 25, 2016
Building bonds: The role of 'trusted advisor' is earned not acquired
A trusted advisor acts as a guiding partner over the full course of a professional relationship.
Multifamily Housing | Aug 17, 2016
A new research platform launches for a data-deprived multifamily sector
The list of leading developers, owners, and property managers that are funding the NMHC Research Foundation speaks to the information gap it hopes to fill.