Industry News




 

11/18/2013

Commercial Construction Industry Outlook and Trends

 
The commercial construction sector is improving.

The outlook for the U.S. commercial construction industry is positive, according to a new report from Jones Lang LaSalle (JLL).

After a rough recession that brought the sector to a standstill in 2009, JLL identified four trends shaping the industry and is calling the comeback an “Extreme Makeover,” which the organization has detailed below.

Financing is Back

Then: A frenzy of overheated lending precipitated the real estate market and drove record construction starts, even as the global financial crisis emerged in 2008. By 2009, construction lending froze, as banks scrambled to reduce risks.

Now: Echoing the healthy activity in construction spending, commercial lending conditions are improving, even while lending standards have remained stagnant. The low cost of capital and re-emergence of the commercial mortgage-backed securities (CMBS) market have both enabled increased liquidity and easier lending. New CMBS issuance totals $50.8 billion so far through the beginning of August 2013, twice the level achieved through the first eight months of 2012. According to the Federal Reserve Board’s Commercial Lending Sentiment survey, 47.8% more respondents reported higher demand for commercial real estate loans in the third quarter of 2013 compared to the second quarter. This dwarfs the 23.4% response seen this time last year, and represents the biggest improvement in demand in more than a decade.

Construction has Become Expensive

Then: Building materials kept construction costs manageable before the crisis. High demand for new construction and free-flowing financing drove bulk purchases at lower prices.

Now: Construction costs are outpacing the recovery in most of the country. The booming single-family home sector has generated rising construction costs for the commercial sector as well, including driving up the cost of labor. According to Rider Levett Bucknall’s Construction Cost Index, which uses construction fees to derive a trend in overall construction costs, the cost of construction increased 3.6% this year. This compares to a 1.5% increase this time last year, and annual growth rates that barely eclipsed two percent in the last two years.

All Buildings are Green Buildings – the Best are Both Green and Smart

Then: Green building features were incorporated upon request, but were generally viewed as expensive and “nice to have” luxuries.

Now: Environmentally-sustainable features are viewed as table stakes by owners and developers, and attention to green building materials is considered a core competency.

LEED v4 formally launched this month and introduced new changes to enhance green building standards. Major new provisions in LEED v4 include expanding property type-specific designations, weighing points more heavily on optimizing energy performance, and a new “cradle to cradle” component. The cradle to cradle provision seeks to ensure that the products and resources used during construction are safe and designed for recycling or composting, and that the manufacturing process for construction materials manages its carbon footprint.

Sandy, Stimulus, and PPPs Shape Revenue

Then: Demand for construction came primarily from private-sector economic expansion.

Now: Much-needed infrastructure updates and rebuilding in the wake of severe storms are driving construction recovery in many geographies. 

While infrastructure is clearly an issue facing the U.S., currently there are little funds available to states for new projects. As a result, public-private partnerships (PPPs) are emerging as a solution when public funding is limited. Natural disaster reconstruction remains “top of mind” for construction executives on the one-year anniversary of Superstorm Sandy, as climate analysts predict more frequent volatile storms in the future.

The 2013 Construction Outlook can be found on JLL’s website.  

 

Connectrac wireways offer discrete power and technology connectivity in open interior spaces of all kinds; affordably, quickly and with long-term flexibility.



When choosing a metal-clad building for your next construction project, consider Morton Buildings, Inc., and their designBUILD team, we’ll make your dream a reality.

Visit our website today to learn about the design flexibility of a Morton building and the endless possibilities of partnering with our designBUILD team.

Wood construction is both cost and energy efficient. Check out Morton Buildings and our designBUILD team online today to discover all the benefits of post-frame construction.

We Can Help You Reduce Energy by 30%

Our mission is to help our customers manage their buildings' energy costs, improve reliability, and enhance performance while having a positive impact on the environment.
CLICK HERE to find out how.


Mitsubishi Electric’s H2i R2-Series heat pumps provide 100% heating capacity down to 0° F and simultaneous heating and cooling down to -4° F delivering year-round comfort, regardless of climate zone.

Connectrac wireways offer discrete power and technology connectivity in open interior spaces of all kinds; affordably, quickly and with long-term flexibility.



When choosing a metal-clad building for your next construction project, consider Morton Buildings, Inc., and their designBUILD team, we’ll make your dream a reality.

Visit our website today to learn about the design flexibility of a Morton building and the endless possibilities of partnering with our designBUILD team.

Wood construction is both cost and energy efficient. Check out Morton Buildings and our designBUILD team online today to discover all the benefits of post-frame construction.

We Can Help You Reduce Energy by 30%

Our mission is to help our customers manage their buildings' energy costs, improve reliability, and enhance performance while having a positive impact on the environment.
CLICK HERE to find out how.


Mitsubishi Electric’s H2i R2-Series heat pumps provide 100% heating capacity down to 0° F and simultaneous heating and cooling down to -4° F delivering year-round comfort, regardless of climate zone.

 
04/23/2014

A key part to curbing emissions is working with local and city officials, tenants, and other groups to help make entire communities more sustainable. BOMA International shares the following strategies for greening your facility and community.

04/21/2014

Lighting fixes target the bottom line.

04/16/2014

The U.S. Army plans to start development of a solar array that will provide about 25% of the annual installation electricity requirement of Fort Huachuca, Arizona.

04/15/2014

The EPA's annual greenhouse gas emissions report is now available.

04/14/2014

Are you what some would call a “climate-change denier”? If so, you'll want to read this.

04/10/2014
Los Angeles has remained the top city for ENERGY STAR certified building since 2008, while Washington, D.C. continues to hold onto second place for the fifth consecutive year, according to a new list released by the EPA.
04/09/2014
Green construction has grown massively over a short period of time.
04/07/2014
Field demonstrations of newly proven energy-efficient technologies are yielding valuable results for the U.S. Navy, helping it meet energy goals.
04/03/2014
Building owners in Chicago now have more options when it comes to getting their building energy data verified.
04/01/2014
According to a new report from Eaton, such outages are up 15% in 2013 over 2012 and over half of those surveyed believe that downtime could have been prevented.
03/31/2014
The newly revised ANSI/ASHRAE Standard 105-2014, Standard Methods of Determining, Expressing, and Comparing Building Energy Performance and Greenhouse Gas Emissions, aims to provide a consistent method of measuring, expressing, and comparing the energy performance of buildings.
03/27/2014
Facility managers face an every expanding array of sustainability choices and challenges, but for the next generation of FMs, green practices could be second nature as sustainability literacy enters the K-12 school system.
03/25/2014
While the economic recession explains the decline in sales in 2008 and 2009, it is much less clear why sales have continued to fall.
03/24/2014
University of Washington (UW) scientists have built the thinnest known LED that can be used as a source of light energy in electronics.
03/21/2014
Mississippi Governor Phil Bryant signed Senate Bill 2378 into law, effectively enacting the state’s first building code.
03/19/2014
In an attempt to improve building energy performance, the DOE’s National Renewable Energy Laboratory has released a web-based tool called the Technology Performance Exchange, or TPEx.
03/18/2014
Could green building practices pose unanticipated life-safety hazards?
03/13/2014
Worried about workplace violence in your facility? Researchers have discovered that “mindfully observing” high-risk employees can avert danger and workplace violence.
03/11/2014
Through the DOE’s Building Energy Codes Program, every dollar the DOE has spent on building energy codes over the past two decades has resulted in $400 in energy cost savings.
03/07/2014
It is possible to harvest energy from Earth's thermal infrared emission into outer space, according to new research from the Harvard School of Engineering and Applied Sciences.
Page 1 of 42
FirstPrevious[1]2345678910NextLast

Sponsored Links