MHC Forecasts 9 Percent Increase in Construction Starts in 2014
McGraw Hill Construction released its 2014 Dodge Construction Outlook, which predicts that total U.S. construction starts for 2014 will rise 9 percent to $555.3 billion, higher than the 5 percent increase to $508 billion estimated for 2013, according to an Oct. 25 press release.
MHC's outlook details the nonresidential forecast as follows:
- Multifamily housing will rise 11 percent in dollars and 9 percent in units. While growth continues, the percentage gains will be smaller than the previous four years, reflecting a maturing multifamily market.
- Commercial building will increase 17 percent, at a slightly faster pace than the 15 percent gain estimated for 2013. Both warehouses and hotels will continue to lead the way, while stores and office buildings pick up the pace. However, next year's activity in dollar terms will still be 28 percent below the 2007 peak.
- Institutional building will edge up 2 percent, turning the corner after five years of decline. Healthcare construction is expected to remain flat, given continued emphasis on cost containment.
“We see 2014 as another year of measured expansion for the construction industry,” said Robert Murray, MHC’s vice president of economic affairs, in the release. Murray notes that the construction industry is expected to grow in 2014 due to job growth, low interest rates and an improving bank lending environment, according to the release. “The 2014 picture bears some similarity to what’s taking place during 2013, with...multifamily housing showing a slower yet still healthy rate of growth after four years of expansion and commercial building gradually ascending from low levels."
The 2014 Dodge Construction Outlook was presented at McGraw Hill Construction’s 75th annual Outlook Executive Conference in Washington, D.C. Copies of the report with additional details by building sector are available for order.