On April 1st, Jim Haughey, Chief Economist at Reed Construction Data, released his latest outlook on the non-residential construction market. Below, you will find a few of his comments, and, below those comments, you’ll find a link to the full article:
Nonresidential: Commercial Environment Continues Mixed
04/01/2011 by Jim Haughey, RCD Chief Economist
Commercial (built to lease) market drivers are balanced among positive, negative and neutral. Office, retail and hotel markets each have one or more positive drivers along with negative and neutral drivers largely due to lingering space surpluses. However, the negative drivers are steadily moving toward neutral. The commercial market remains on a path to a sustained recovery early in 2011. Several long lead indicators have been positive since last fall. The AIA index of design work underway is above 50, which indicates expansion at the pre-start project phase.
There have been some spot rises in commercial starts since last spring but they have not been sustained.
The build vs. buy indicator still points at buy for real estate investors in most markets.
The market drivers for institutional construction are rapidly deteriorating. Federal stimulus funding is ebbing quickly.
Higher education, hospitals, nursing homes and cultural facilities have access to non-taxpayer money and will fare better than K-12 education and public buildings.
Here’s the link to the full article:
I encourage you to read the full article; the article contains a number of interesting statistics and trends.