Leopardo released its 2016 Construction Economics Report and Outlook, a guide to help business leaders, healthcare administrators and government decision-makers understand the factors that impact construction costs.
This year’s report shows that 2015 was a turning point for commercial real estate construction, as spending reached the highest level since the Great Recession and even the pace of growth accelerated more than in previous years.
By the end of 2015, total spending on U.S. construction grew 10.5% to $1.1 trillion, the largest year-over-year gain since 2007. The most dynamic growth was in the private sector, where construction spending expanded 12.3%, compared to just 5.6% growth in public-sector projects.
"With a steadily growing economy, low national vacancy rates and historically low interest rates, companies are seeing this period as the right time to expand or relocate their facilities to accommodate growth,” said Jim Leopardo, CEO of Leopardo. “We’re seeing healthy construction volume of nearly every property type, both nationally and in the Chicago area.”
Key findings in the report include:
- Multifamily construction has grown by 29.4% annually since 2011, driven by a movement of renters by choice in urban work-live-play areas. In the same period, single-family home construction increased 14.8% annually.
- Office construction spending grew by 22% in 2014, driven by job growth in the tech sector. This growth spurt is expected to scale back to an average 5.9% annual growth rate through 2019.
- Construction jobs grew 7.8% in the Chicago area, outpacing the national average of 4.2% in 2015. In 2014, Chicago’s 3.2% construction job growth lagged the national average of 5.7%.
Related Stories
Market Data | Nov 27, 2017
Construction's contribution to U.S. economy highest in seven years
Thirty-seven states benefited from the rise in construction activity in their state, while 13 states experienced a reduction in activity.
Market Data | Nov 15, 2017
Architecture Billings bounce back
Business conditions remain uneven across regions.
Market Data | Nov 14, 2017
U.S. construction starts had three consecutive quarters of positive growth in 2017
ConstructConnect’s quarterly report shows the most significant annual growth in the civil engineering and residential sectors.
Market Data | Nov 3, 2017
New construction starts in 2018 to increase 3% to $765 billion: Dodge report
Dodge Outlook Report predicts deceleration but still growth, reflecting a mixed pattern by project type.
Market Data | Nov 2, 2017
Construction spending up in September; Down on a YOY basis
Nonresidential construction spending is down 2.9% on a year-over-year basis.
Market Data | Oct 19, 2017
Architecture Billings Index backslides slightly
Business conditions easing in the West.
Industry Research | Oct 3, 2017
Nonresidential construction spending stabilizes in August
Spending on nonresidential construction services is still down on a YOY basis.
Market Data | Sep 21, 2017
Architecture Billings Index continues growth streak
Design services remain in high demand across all regions and in all major sectors.
Market Data | Sep 21, 2017
How brand research delivers competitive advantage
Brand research is a process that firms can use to measure their reputation and visibility in the marketplace.
Contractors | Sep 19, 2017
Commercial Construction Index finds high optimism in U.S. commercial construction industry
Hurricane recovery efforts expected to heighten concerns about labor scarcities in the south, where two-thirds of contractors already face worker shortages.
