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IBISWorld Updates their US Industry Market Research Report in Commercial Building Construction

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 IBISWorld’s US Industry Market Research Report predicts an extremely high demand for new construction over the next five years because of strong industrial growth.

New York City, September 21, 2014

 By Indranil Bhattacharjee
September 21, 2014

IBISWorld, an acclaimed industry research firm, has recently updated their Commercial Building Construction industry report. This report forecasts impressive performance for the country’s commercial construction industry that has been struggling ever since the recession. The need for new commercial properties diminished drastically during this period because of the downsizing and closure of many businesses. The situation worsened because of factors such as high unemployment, an unfavorable credit market, inadequate consumer spending, and a serious stagnation in per capita disposable income.

In general, commercial construction industry tends to lag behind the condition of the overall economy. This is mainly because of the length of different construction contracts and the tendency of the contractors to keep a pipeline of projects on the books. During the tough economic phase in 2009 and 2010, most of the operators were forced to cut prices to remain competitive. However, in today’s stronger market scenario, the economic indicators have improved significantly. Danielle Karvess, an industry analyst from IBISWorld, sums up the present scenario saying, “Overall improvements across the US economy will boost strong industry growth during the next five years, with the need for new construction returning as businesses expand to meet growing consumer demand.”

The market share of the industry for commercial construction is at a low level because even four of the country’s largest companies hold an extremely small part of the overall industry revenue. “The largest players are multinational general contractors (GCs) with the resources and staff to handle massive, lucrative contracts for state-of-the-art structures like super skyscrapers and professional sports arenas. However, most participants in the industry are small-scale GCs that serve a narrow, local geographic region,” Karvess said.