Nonresidential construction spending is expected to take a step back in 2019 compared to 2018; however, overall nonresidential building is still predicted to grow. At the start of the year, economists from different firms polled by The American Institute of Architects (AIA), said views have changed for the better, according to the recently released consensus forecast from AIA.
"At the halfway point of the year, this panel is even more optimistic," said AIA Chief Economist Kermit Baker, Hon. AIA, Ph.D. in the release. Overall nonresidential building was predicted to have a 4.7% growth in 2018 and a 4% growth in 2019. At the beginning of the year, it was projected that nonresidential spending would increase 4% this year and slightly under that next year.
Commercial/industrial is expected to have a large drop-off next year, coming in at 3.4% growth compared to nearly 7% this year. However, industrial growth is forecasted to increase 5% year-over-year. Meanwhile, the institutional sector is expected to remain the same at 4.5% growth. Public safety is forecasted to see a large drop in growth as well from 10.9% to 5.9%.
"If these projections materialize, by the end of next year the industry will have seen nine years of consecutive growth, and total spending on nonresidential buildings will be 5% greater—ignoring inflationary adjustments—than the last market peak of 2008," added Baker.
-Michael Miller, managing editor
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