Job site spending was steady or increased for every nonresidential building market in March. The largest gains were for manufacturing and education. The manufacturing gains were the delayed capacity building reaction to last years’ energy and metal shortages. They may extend for a few more months but the recent sharp decline in new project starts means significant spending cuts are soon ahead. The pick-up in education construction spending is also counter to the still expected slow decline trend for most of 2009. Available financing has shrunk for both K-12 and higher education facility managers.

Nonresidential building construction spending will drop 4.3% this year after double digit gains for three years. Spending will improves throughout 2010 but the full year will average 1.7% below 2009. This years’ decline will be about 16% for private “for lease” buildings but only about 2% for institutional building whose owners are largely insulated from direct damage from the financial market and will get a small boost from economic stimulus spending.

U.S. Nonresidential Construction
(billions of U.S. current dollars)

* Monthly figures are seasonally adjusted at annual rates (SAAR figures).
Actuals: U.S. Census Bureau (Department of Commerce) (put-in-place investment figures).
Forecasts and table: Reed Construction Data.