January 4, 2008—By and large, the construction industry is worried about 2008, according to an article in Commercial Property News.
With only a few exceptions, 2008 forecasts by the Portland Cement Association (PCA) and McGraw-Hill Construction projected declines in virtually all segments of the non-residential building construction market. FMI Corp., a Denver-based research firm, was a bit more optimistic, predicting construction growth, albeit at a significantly slowed rate, says the article.
As reported in the Nov. 19 edition of Engineering News Record, PCA projects that total construction put-in-place will decline by 3.7 percent in 2008. Non-residential construction, which increased by 12.9 percent in 2007, will fall by 3 percent in 2008. Commercial construction will be the biggest loser, with a projected decline of 6.4 percent. Educational buildings and healthcare facilities will be the exceptions. The PCA forecasts suggested that those categories would rise by 4 percent and 3.9 percent respectively, the article notes.
McGraw-Hill Constructions forecast of contract awards for 2008 shows similar percentage declines in the non-residential building market. Total construction will fall by 2 percent next year; office will decline by 3.4 percent; retail will fall by 6.8 percent; hospitality will drop 8.9 percent; and other commercial construction contract awards will lose 9.4 percent from this year. The bright spot in non- residential building construction for McGraw-Hill will be educational buildings, a category expected to rise by 7 percent.
By comparison, the forecast from FMI Corp. is relatively optimistic, calling for growth of 1.9 percent in total construction put-in-place during 2008. All segments of the residential construction market will continue to decline in 2008 but at a much more manageable pace.
For more information, see the article in Commercial Property News.
