Commercial construction may remain low

Commercial construction may not pick up for the next several months.

Many property management companies may not experience significant growth in commercial construction through much of 2013, according to a report from Engineering News-Record and McGraw-Hill Construction.

The third quarter had a level of 50 for ENR's Construction Industry Confidence Index, which meant that the market is stable. The report explained that any figure above 50 shows the market is growing, while anything below that level shows there are recovery issues. The latest figure is a decline from the first quarter of 2011, when the index was 58. This meant that construction industry members became more cautious in recent months.

"ENR's CICI provides strong indicators for movement in the construction industry," said Janice Tuchman, editor-in-chief of ENR. "What we are seeing is a less optimistic outlook for recovery. Of course it varies by sector, but there are few clear winners in the current market. Next year will be an important year where the market begins to stabilize and set the stage for recovery."

The report found that many industry members felt the private sector was the best-performer for construction. This included multifamily properties, healthcare, power and petroleum-related markets. However, office, retail, elementary education and entertainment-related construction still struggled.

Approximately one-third of respondents noted that the construction industry was still in a state of decline, but nearly 20 percent felt it was improving, the report found. There was 25 percent of all executives that noted the construction market will improve in the next two quarters.

When looking to the end of next year, more than half of respondents felt that the conditions in the industry will improve, the report said. Less than 10 percent said that the market will get worse in that time.

Presidential election may have lasting effect on construction

Many industry members felt that the recovery situation over the next few years strongly depended on the upcoming election. The report said that more than 70 percent felt that Mitt Romney would be the best choice to improve recovery. Another 15 percent noted that Obama would be the prime candidate, while another 14 percent were undecided.

The report added that an unnamed executive stressed that the private sector would see more construction under Romney, while President Obama will likely focus more on the public construction market.

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