Nonresidential building jobsite spending declined 6% in the last three months after a long expansion. The decline is 10% for commercial buildings and 3% for institutional buildings. The value of nonresidential building starts fell 10% over the same period after adjusting for declining project costs and the usual seasonality in starts. The federal spending increase has very little directly for work in this market. Hence, the slide will continue through the year until the overall economy is again expanding.

Civil construction is faring better although the earlier dip in state and local government tax receipts has now halted the long expansion. The first of the new federal money for heavy construction will appear in job site construction spending in March. But the amount will not be significant for several more months and will grow progressively into 2010.

The coincident indicators for private market facility capacity demand proxies are all declining rapidly. This includes transportation system usage and development acreage. Expect private civil work to decline rapidly while public civil work is steady to slightly down early in 2009 and then begins to increase. This reverses the mix of civil work in 2007-08 when private was very strong and public was weakening.

Key Indicators of the U.S. Market Environment — March 2009
Commercial and Industrial Construction (Driven mainly by cyclical factors)

	Year Ago	Previous Month or Qtr.	Latest		Level	Recent Trend	Impact on Const.
Commercial
Dow Jones composite REIT, index (Dow Jones)	209	95	W/E Mar 9th	74	Low	Falling
10-Year T-bill rate, % level (FRB)	4.14	2.92	W/E Mar 6th	2.9	Low	Steady
Office rent, 54 metro areas, % change y/y (PPR)	6.5	-2.1	Q4	-3.8	Low	Falling
Office vacancy rate, 54 metro areas, % level (PPR)	15.2	16.8	Q4	17.5	High	Rising
Office employment, % change y/y (P&PR)	0.3	-1.3	Q4	-2.4	High	Falling
Office construction starts ($s), 3-mon. ave. y/y % change (RCD)	-33.8	-13.5	Feb	6.8	Low	Falling
Hotel room rate, 54 metro areas, % change y/y (PPR)	3.9	2.3	Q4	1.5	High	Falling
Hotel occupancy rate, 54 metro areas, % level (PPR)	66.7	64.0	Q4	62.2	Average	Falling
Airline revenue passenger miles, % change y/y (RCD)	5.0	-6.5	Feb	-10.0	Average	Falling
Real price of gasoline , $s/gal. (U.S. Energy Dept.)	3.05	1.7	Jan	1.78	High	Falling
Hotel construction starts ($s), 3-mon. ave. y/y (RCD)	-37.4	-17.6	Jan	-1.5	High	Falling
Retail rent, 54 metro areas, % change y/y (PPR)	-22.3	-2.7	Q4	-7.4	Average	Falling
Retail vacancy rate, 54 metro areas, % level (PPR)	11.3	14.7	Q4	18.1	Average	Rising
Retail sales, % change y/y (U.S. Census Bureau)	3.9	-9.7	Jan	-9.3	Low	Falling
Consumer confidence index (The Conference Board)	76.4	37.4	Feb	25.0	Low	Falling
Consumer real income growth, % change y/y (U.S. Commerce Dept.)	-0.5	3.4	Dec	7.8	High	Rising
Retail construction starts ($s), 3-mon. ave. y/y (RCD)	-4.4	-35.2	Feb	-32.2	Low	Falling
Industrial
Warehouse rent, 54 metro areas, % change y/y (PPR)	1.5	-2.4	Q4	-3.4	Low	Falling
Warehouse vacancy rate, 54 metro areas, % level (PPR)	8.6	8.8	Q4	9.1	Average	Falling
Business inventory, % change y/y (U.S. Census Bureau)	2.9	4.1	Dec	0.9	High	Falling
Business sales, % change y/y (U.S. Census Bureau)	-9.5	-6.2	Dec	-11.8	Low	Falling
Warehouse construction starts ($s), 3-mon. ave. y/y (RCD)	-8.2	5.0	Feb	40.1	Low	Falling
Capacity utilization rate, % level (FRB)	79.1	69.6	Jan	67.9	Low	Falling
Manufacturing production index (FRB)	103.6	89.3	Jan	86.3	Low	Falling
Goods Exports $ billions (U.S. Commerce Dept.)	101.8	97	Dec	88.7	Low	Falling

Abbreviations: y/y = year over year; WE = week ending; FRB = Federal Reserve Board;
PPR = Property & Portfolio Research; RCD = Reed Construction Data.
Table: Reed Construction Data and Reed Construction Data - CanaData.

Key Indicators of the U.S. Market Environment — March 2009
Institutional and Engineering Construction
(Driven by demographics and government finances, as well as cyclical factors)

	Year Ago	Previous Month or Qtr.	Latest		Level	Recent Trend	Impact on Const.
Institutional
State & local govt. capital spending, $ billions (U.S. Commerce Dept.)	349	362	Q4	368	High	Rising
State & local government tax receipts, $ billions (U.S. Commerce Dept.)	1414	1330	Q4	1308	High	Falling
State budget reserves, % of Exp (National Governors assn.)	10.5	n/a	FY 08	8.0	High	Falling
Stock market index (Dow Jones Industrial)	11,894	7,840	Mar 9th	6,547	Low	Falling
K-12 enrollment, millions of peopl (U.S. Education Dept.)	55.762	n/a	2007-08	55.966	Average	Steady
Higher-education enrollment, millions of people (U.S. Education Dept.)	17.598	na/	2007-08	18.264	High	Rising
Hospital receipts, $ billions (U.S. Health & Human Services Dept.)	648.2		2007	696.7	High	Rising
Prison population, % change y/y (Pew Charitable Trust)	4.3	N/A	2007-08	2.5	High	Falling
Heavy/Engineering
Federal highway trust fund, $ billions (U.S. Treasury Dept.)	11,247	10,366	Jan	9,886	Low	Falling
Electric power capacity utilization rate, % level (FRB)	87	86	Jan	87	High	Falling
Airline revenue passenger miles, billions (RCD) (ann. % change)	1.6	-6.5	Jan	-7.2	Average	Falling
State & local govt. capital spending, $ billions (U.S. Commerce Dept.)	349	362	Q4	368	High	Rising
State and local government tax receipts, $ billions (U.S. Commerce Dept.)	1414	1330	Q4	1308	High	Falling
Heavy contractor employment, 000s (U.S. Labor Dept.)	997	929	Jan	924	High	Falling
Construction equipment shipments, % change y/y (U.S. Census Bureau)	12.7	-6.2	Jan	-10.1	Average	Falling

Abbreviations: y/y = year over year; WE = week ending;
FRB = Federal Reserve Board; RCD = Reed Construction Data.
Table: Reed Construction Data and Reed Construction Data - CanaData.