By Tasha Anderson for AZBEX
To prepare for the final Leading Market Series of 2020, BEX President and Founder, Rebekah Morris, asked hundreds of owners, from private developers and institutional owners to public owners, asking for their perspective on where they think the construction market is headed in 2021.
While many of the responses came from owners who are involved in larger projects of more than $15M in construction value and who are usually involved in more than 10 projects at one time, BEX did receive responses from owners in a variety of market sectors, including: Transportation and Transit, Education, Municipal Buildings, Housing, Office/Retail, Healthcare, Industrial and Hospitality.
The answers to the survey questions were shared with more than 70 attendees at the virtual event on December 9th.
COVID-19 Impacts and Economic Uncertainty
During the event, Morris asked attendees some of the same questions from the survey, then compared the answers to the owners’ responses. One of those questions was regarding the impact that COVID-19 had on projects they were involved with.
While some said that there has been no impact to their projects, the majority of responses from both owners and attendees showed that schedule delays, cost increases and workforce challenges are the most common impacts on projects from the pandemic.
Another question pertained to the influencing factors for their projects moving forward. Owners and attendees agreed that economic uncertainty was the biggest impact on their projects moving forward. Yet when asked what would make owners accelerate a project in their pipeline, economic and political certainty was not the top answer. Instead, another federal stimulus package and a decrease in construction costs seem to be the ticket to accelerating a project.
Owners responses showed construction prices has the second biggest factor while availability of skilled tradespeople was the second biggest factor for attendees.
The Past, Present and Future
Morris shared that most owners perceived business in 2020 to be about the same as 2019, while anticipating business in 2021 to be about the same as 2020 or somewhat better.
When asked the same question, 38 percent of the attendees that responded to the survey perceived 2020 to be about the same for business compared to 2019 and that 33 percent anticipates business to be somewhat better in 2021.
The BEX Perspective
In analyzing the results of the survey and studying trends and the current climate, some conclusions can be made about the construction market such as the benefit of a Federal stimulus package for both private development and public works, and the impact construction prices have on both private and public projects.
Other conclusions Morris shared were geared more toward public works, such as:
- Publicly funded projects are generally more secure.
- Public owners like Pima County and City of Yuma are moving toward JOC and hard bid solicitations, while some are sticking to keeping the contractor involved earlier to control cost.
- COVID-19 uncovered underlying issues in Higher Ed and K-12 spaces and forced public agencies to move into electronic bidding and virtual meetings.
For a more in-depth look into 2021’s construction market, register for the BEX Virtual Construction Activity Forecast event on January 15th, 2021. The BEX research team will take project-specific data, direct from DATABEX, comparing with permit data, CIP information and much more to provide an accurate view of each market sector.