RALEIGH, N.C. — FMI, management consultants and investment bankers for the construction industry, released its Construction Outlook: Third Quarter 2009 Report. The outlook for the general economy is improving, but that doesn’t mean good news for construction yet, reports FMI’s Construction Outlook, a quarterly, construction-market forecast and supplement to the U.S. Markets Construction Overview FMI has produced since 1985. Total construction in 2009 and 2010 will be down 14 percent and 5 percent, respectively.
This quarter’s outlook takes a more in-depth look at the trends and drivers affecting residential, nonresidential buildings and nonbuilding structures construction.
Report highlights include:
- Residential construction will decline 25 percent in 2009 and will recover in 2010.
- Nonresidential construction will decline 13 percent in 2009 and 16 percent in 2010.
- Nonbuilding construction will be the only positive contributor, increasing 5 percent per year in 2009 and 2010.
- Project cancellations are five times the normal rate and are currently at 10 percent of backlog (doubled from the third quarter of 2008).
- Total residential construction will be $268.5 billion in 2009, down from its 2006 high of $619.8 billion.
- 2009 will be the worst year for housing starts since records began being kept in 1959.
- Power construction is expected to remain positive for the next five years, attaining new highs each year, reaching $122.1 billion in 2013.