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Latest News

Despite nagging concerns about the overall U.S. economic outlook, an American Institute of Architects panel predicts robust growth in the non-residential construction market through 2007, according to an on-line article by AIA Chief Economist Kermit Baker.

The AIA Consensus Forecast Panel anticipates a 6.3% increase in non-residential construction for this year, with another 6.2% growth in 2007. Both figures are adjusted for inflation. Further, the panel expects the growth to be balanced between the commercial/industrial and institutional segments of the market. If this rate of growth is achieved, it will be the best two-year period in non-residential construction since 1997-98, Baker writes.

The panel cites higher short-term interest rates, price increases in construction materials—copper was up some 85% in the 12 months preceding mid-year—a softer job market and higher oil prices as potential problems for the economic outlook. None the less, the non-residential construction outlook is positive throughout the U.S.

Highlights from the panel include:

Commercial construction is forecast to gain an inflation-adjusted 5% this year and next.

Industrial construction is forecast to increase a net 17% in 2006 and 7.5% additionally in 2007.

Office construction will continue to benefit from falling office vacancy rates across the country.

The retail construction outlook is for 4% net gains this year and in 2007.

Hotel construction is predicted to increase 11% this year, followed by another 6.5% growth in 2007.

Education construction is forecast to increase 4.4% in 2006 and 7.4% next year.

The panel predicts health care construction will grow by 6.3% this year and an additional 5% next year.

To read the complete story, please click here.