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New Data: AIA Consensus Construction Forecast

Written by Heidi Schwartz. Posted in Economic Development

Tagged: , ,

Published on July 28, 2011 with No Comments

A multitude of factors is preventing a recovery for the beleaguered design and construction industry. And according to the latest American Institute of Architects (AIA) semi-annual Consensus Construction Forecast, nonresidential construction spending is expected to decline for the remainder of 2011; modest growth is projected for 2012.

Lenders that have been extremely reticent to finance construction projects, budget shortfalls at all levels of government, the ripple effect of overbuilding, a depressed housing market, and rising costs of key construction commodities are all contributing to what projects to be a decline of 5.6% in spending this year for nonresidential construction projects. On the other hand, the survey of the nation’s leading construction forecasters does project a 6.4% increase of spending in 2012.

“Consumer and business confidence is poor, and the overall economy has yet to pull out of the downturn that began in 2008; both [of these factors] add to the general sense of anxiety and uncertainty in the real estate market,” said AIA Chief Economist Kermit Baker, PhD, Hon. AIA. “Spending on renovations of existing buildings has remained strong, but the depressed demand for new construction isn’t likely to improve until next year, led by the commercial sector: offices, retail and hotels.”

Market Segment Consensus Growth Forecasts

Overall nonresidential: -5.6% (2011), 6.4% (2012)

Commercial/Industrial: -6.5% (2011), 11.8% (2012)

  • Hotels: -17.9% (2011),  18% (2012)
  • Industrial: -15.8% (2011), 8.4% (2012)
  • Office buildings: -6.1% (2011),  9.8% (2012)
  • Retail: -3.1% (2011), 11.8% (2012)

Institutional: -3.4% (2011), 4.4% (2012)

  • Religious: -10% (2011), 6.3% (2012)
  • Education: -5.2% (2011), 2.6% (2012)
  • Public safety: -2.5% (2011), 0.9% (2012)
  • Amusement/recreation : -0.3% (2011), 5.9% (2012)
  • Healthcare facilities: 1.8% (2011), 7.1% (2012

About Heidi Schwartz

Heidi Schwartz

Schwartz joined Group C Media in April 1989 as managing editor of Today's Facility Manager (TFM) magazine (formerly Business Interiors) where she was subsequently promoted to editor/co-publisher of the monthly trade magazine for facility management professionals. In September 2012, she took over the newly created position of internet director for TFM's parent company, Group C Media, where she is charged with developing content and creating online strategies for TFM and its sister publication, Business Facilities. Schwartz can be reached at

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