Starts remain low in CanaData’s latest forecasts, but there are signs of a pickup in optimism

CanaData’s forecast for total non-residential building construction starts nation-wide in 2009 now stands at 45.5 million square feet. This is about half of what it was two years ago in 2007 at 92.1 million. Last year was the first year of decline in the recession and the square footage of ICI starts (industrial, commercial and institutional) dropped to 75.5 million. The new slightly revised forecasts for 2010 and 2011 are for 56.0 million and 70.0 million square feet respectively.

CanaData’s October Construction Starts and Remembering Planned Obsolescence with Some Fondness

Industrial starts have become a non-factor in overall construction activity in Canada. They are going to amount to less than two million square feet in 2009, which is less than one good-sized shopping mall when times are better. How did industrial work come to such a sorry pass?

It’s a World of Opportunities as Economic Thoughts Turn to Recovery

The current mantra about the world economy seems to be that no one can take recovery for granted until the private sector replaces the public sector as the source of new demand. Central bankers, with few exceptions (e.g., Australia) are unlikely to alter their extraordinarily low interest rate policies until unemployment stops rising and the need for government stimulus money winds down. A thorough read of the daily business news, however, reveals that a great deal more is going on behind the scenes and that some business owners and managers are attempting to get out front of events while tremendous opportunities are still available.

Housing markets in Canada and U.S. tell complex stories

The housing markets in Canada and the U.S. continue to tell complex stories. Canada’s housing starts have been gradually creeping up since their April low. For 2009 as a whole, they are expected to be 140,000 units, rising to 160,000 in 2010, then 180,000 in 2011. The stock of unsold single-family homes in Canada is adjusting downward in an appropriate fashion, but the unsold stock of multiples is still climbing. In the U.S., the monthly annualized starts number is just under 600,000 units. Similar to Canada, the improvement next year will be only gradual, to 700,000 units, with a further modest gain in 2011 to 900,000.

The Current Grace Period for Construction Costs will Expire within Six Months

Several factors are conspiring to give construction costs a lift. This won’t happen overnight. But it does mean that sometime in the next six months, the current grace period will expire.