3. Annual Rate of Construction
Spending US (Billions)1
Public ($) Private ($) Total ($)
2008 319.6 737.1 1053.7
2009 309.6 593.0 902.5
2010 301.0 486.9 787.9
2011 286.6 529.7 816.4
2012 270.1 614.9 885.0
2013 266.5 663.9 908.4
2014 283.5 698.6 982.1
2015 294.3 828.2 1122.5
2016 284.5 897.0 1181.5
2017 294.8 967.9 1262.7
2018 301.5 991.2 1292.7
2019 338.6 985.5 1324.1
3
1Numbers come from December Annual Construction Report for the US Census Bureau, except for 2019 numbers which came from
the November Report. Dollars are counted valued as construction put in place.
4. United States
Construction Starts ($ Billions)
(Dodge)
In billons 2018
Actual
2019
Estimate
2020
Forecast
% change
18-19
% change
19-20
Total Construction 815.01 808.7 776.4 -0.8% -4.0%
Residential 329.9 314.1 295.3 -4.8% -6.0%
Single Family 230.1 223.5 216.8 -2.9% -3.0%
Multifamily 99.8 90.6 78.5 -9.2% -13.4%
Nonresidential 296.6 292.5 284.7 -1.4% -2.7%
Nonbuildings 188.5 202.1 196.4 +7.2% -2.8%
4
ENR Magazine, November 18/25 2019, p 9
5. FMI Construction Put In Place
Forecast 2020($ Billions)
In billons 2018
Actual
2019
Estimate
2020
Forecast
% change 18-19 % change
19-20
Total Construction 1,307.249 1,312.631 1,344.204 +0.4% +2.4%
Total Residential 546.136 524.659 528.957 -3.9% +0.8%
Total
Nonresidential
529.312 542.384 556.848 +2.5% +2.7%
Non-buildings 231.801 245.588 258.400 +5.9% +5.2%
5ENR Magazine, November 18/25 2019, p 9
6. Construct Connect Construction Put
In Place Forecast 2020($ Billions)
In billons 2018
Actual
2019
Actual
2020
Forecast
2021 Forecast 2022 Forecast
Total Construction 1307.2 1286.1 1310.8 1341.3 1383.3
Total Residential 546.1 507.9 521.1 534.1 551.2
Total
Nonresidential
761.1 778.2 789.7 807.2 832.0
Total Commercial 201.4 196.2 192.8 192.3 194.7
Total Institutional 181.1 182.2 180.2 180.1 183.9
Total Eng/Civil 307.9 327.3 341.3 356.3 371.6
Total Ind/Manuf. 70.8 72.6 75.4 78.5 81.8
6Alex Carrick, Winter 2019-2020 Forecasts, p. 6
7. Dodge Construction
National Growth Forecast
7
Annual % Change for $Volume of
Construction Starts
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
+12.0 +10.0 +6.0 +5.0 +2.0 +5.0 +12.0 +13.0 +3.0 -7.0 -13.0
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
-24.0 +2.0 +1.0 +12.0 +11.0 +11.0 +14.0 +7.0 +7.0 +3.0 0.0 -4.0
ENR Magazine, November 18/25, 2019, p 15
8. US Construction Market Cycles
Years Trough to Peak Peak to Trough Total Cycle
1975-1982 16 Quarters
1975-1979
13 Quarters
1979-1982
29 Quarters
1982-1991 16 Quarters
1982-1986
19 Quarters
1986-1991
35 Quarters
1991-2011 58 Quarters
1991-2005
22 Quarters
2005-2011
80 Quarters
2011-? 33 Quarters
2011 to present
? 33 Quarters
8
Jeff Gavin, Electrical Contractor Magazine, January 2020
9. Dodge Construction Starts
US Outlook-2020
• Total Construction down to $776 billion in 2020, down 4% from 2019
• Residential building will be down in 6% in dollar value
• Non-residential building will be down 3% in dollar value.
• Sing. Fam. housing will drop of 3% in housing starts and 5% in units
• Multi-Family housing will slide 13% in dollars and 15% in units
• Commercial building will retreat 6% in 2019
• Institutional building will match 2019.
• Mauf. Plant will decrease 2% in 2020.
• Public Works construction will increase 4% in 2020
• Electrical utiltities/gas plants will drop 27% in 2020 after up 83% in 2019.
9
Data from www.construction.com, January 2020.
10. Pattern of US Construction
Starts 2014-2020 (in billions $)
Dodge 2020 Construction Outlook
2014 2015 2016 2017 2018 2019 2020
Residential 234 274 298 307 330 314 295
Commercial 83 94 115 117 123 127 120
Industrial 36 25 20 26 33 23 23
Non-Building 147 187 183 193 189 202 196
Institutional 105 110 123 145 141 143 142
Total
Construction
606 690 739 788 815 809 776
10
Jeff Gavin, Electrical Contractor Magazine, January 2020
11. National Development
Profile
West Midwest Northeast South Nat. Average
51.3 49.9 47.2 55.5 52.0
11
The further the index is from 50, the larger the number of firms reporting the change
Index <50- Architectural Firms are reporting decrease in billings
Index=50 –Architectural Firms are reporting no change in billings
Index>50- Firms are reporting an increase in billings
Construction Business Owner, January 2020 p. 48
West Midwest Northeast South
Q3 2018 9.35 7.76 9.21 10.01
Oct. 2019 6.4 8.1 8.6 11.3
Construction Backlog Indicator (in months)
ABC Press Release, P. 2, 12/17/2019
12. US National Construction
Optimism Quotient
103.0 109.0102.0
86.0
80.0
42.0
66.0
96.0
114.0
103.0
124.0
130.0
108.0
123.0
133.0
122.0
0.0
20.0
40.0
60.0
80.0
100.0
120.0
140.0
12
Wells Fargo 2019 Construction Industry Forecast, p. 10
13. Turner Building Cost Index
13
Turner Building Cost Index, 2019 Q4
Year Ave.
Index
% Change
Y to Y
2019 1156 5.5
2018 1096 5.6
2017 1038 5.0
2016 989 4.8
2015 943 4.5
2014 902 4.4
2013 864 4.1
2012 830 2.1
2011 812 1.6
The 2019 Number, which
measures costs in the non-
residential building
construction market, is the
highest in the 13 year history
of the index
14. Other National Trends
14
1. According to the American Society of Civil Engineers, it will take approximately
$4 Trillion to repair the current state of US infrastructure by 2025.
1
2. For the last 3 years, construction spending has increased 8% but inflation was
14%. Volume decreased 6% but jobs increased 11%
2
3. Only 20% of all construction spending in 2020 will come from new jobs that start
in 2020. The other 80% of spending is already in backlog and comes from jobs
started in 2017-2019. That 80% is not indicating anything resembling a recession.
(Ave spending on a job-1st year (20%), 2nd yr. (50%), 3rd year is (30%). 2
4. Year ending totals for Construction Starts (In Millions of Dollars)3
2018 2019
Non Res. Bldg $293,093 $298,680
Res. Bldg $330,333 $321,987
Non Bldg. $188,925 $202,006
TOTALS $817,351 $817,673
1 Deloitte Engineering and Construction Outlook, p. 5 and 7
2 Ed Zarenski, Construction Blog
3 Dodge Press Release, Jan. 21, 2020
15. California Economic
Data at a Glance
15
• State Population 39,557,000
• Median Household Income $75,209
• Job Growth (2019)-1.6% Projected Annual Job Growth-0.8%
• Cost of doing business-13% above national average
• Net Migration (2018)-54,200
• Unemployment 4.1%
• Median Household Income $75,209 Median Home Price-$591,700
• Union Workforce-14.7%
Forbes Lists
#31 Best State for Business #1 in Economic Climate
#47 in Business Costs #10 in Growth Prospects
#40 in Regulatory Enviornment #27 in Quality of Life
Forbes Best States for Business, Webpage January 2020
16. More Highlights of the California
Data
16Construction Industry Research Board, California Center for Jobs and the Economy,California Public
Policy Institute
1. California Housing Units for 2019
- Single Family Units 53,404 Total Units were 120,302-highest since 2006
- Multi Family Units 66,898 Lowest Total was in 2009 36,421
2. Union Membership for Construction
12.8% United States 0.0% Oklahoma
15.9% California 41.6% Hawaii
3. Beacon Economics put the backlog for homes in California at 2.3 million housing
units in 2017. To keep pace, California needs an average of 180,000 homes per year.
4. 54.8% of California housing units were owner occupied, 10.2% lower than the
national average.
17. Housing Production in CA
2004-2019
212960
208972
164280
113034
64962
36421
44762
47343
59225
85472 85844
98233100961
115670
117892
120302
0
50000
100000
150000
200000
250000
New Housing Units
2004 2005 2006 2007 2008 2009 2010 2011
2012 2013 2014 2015 2016 2017 2018 2019
17Information from the California Building Industry Foundation. 2019 data is through November 2019
18. San Jose, Sunnyvale, Santa Clara
Construction Starts
($ millions)
In millions ($) 2016
Actual
2017
Actual
2018
Actual
2019
Forecast
2020
Forecast
Total Construction 4,985 6,713 3,830 4,581 4,674
Residential 1,182 1,981 1,722 1,682 1,832
Non Residential 3,144 3,246 1,463 1,946 2,097
Comm/Manuf 2,291 1,669 939 1,166 1,319
Office/Bank 1,621 955 404 723 804
Institutional 853 1,577 524 780 778
Nonbuildings 659 1,485 645 953 745
18ENR Magazine, December 2/9, 2019, p CA4
19. San Jose, Santa Clara, Sunnyvale
Construction Starts 2011-2020
2377
4153 4213
6127
3718
4985
6713
3830
4581 4674
0
1000
2000
3000
4000
5000
6000
7000
8000
Total Construction
Total Construction, in Millions 2011
2012
2013
2014
2015
2016
2017
2018
2019 (f)
2020 (f)
19
Engineering News Record San Jose Reports-2011-2020
(2019 and 2020 are forecasted numbers) ENR California, Decembver 2/9, p. CA4
20. Private Housing Units Authorized by
Building Permits San
Jose/Sunnyvale/Santa Clara MSA
20
1Census Bureau Statistics, through November 2019
3226
995
4116
2645
5665
7628
9599
7262
6344
7193
8955
7906
0
2000
4000
6000
8000
10000
12000
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
# of Units
# of Units
21. Santa Clara County
Real Estate Trends-Commercial
21
1 San Jose Business Journal, Jan. 17,2020 p. 23
Area 2019 Office Lease.
Activ. (Sq.Ft.)
Office under const.
(Sq. Ft)
Overall Office Vacancy
Rates
Overall Valley 9,652,444 4,836,022 9.2%
Downtown SJ 662,055 1,769,000 12.9%
North SJ 1,422,736 242,320 17.8%
Alameda/Civ Cent 102,968 32,307 3.1%
South San Jose 62,760 0 3.1%
Airport 1,341,018 359,179 13%
22. Santa Clara County
Real Estate Trends-Commercial pt. 2
22
• The SV region saw 3.44M sq. ft. of net office absorption, led by
Sunnyvale at 1.0M sq. fit and San Jose by 849K sq. ft.; its total office
vacancy rate decreased to 9.2%.
• Almost 8M sq. ft. of office space is under construction in valley.
• Related Companies will start an $8 billion project in Santa Clara at the
Golf Course which will cover 240 acres of offices, hotels, residences,
park space and restaurant and retail outlets. It includes 4.4 million sq. ft
of office space, none of which is pre leased. The project is called Related
Santa Clara.
• Jay Paul is working on a 3.8 million sq. ft mixed use office campus called
CityView Plaza. None of the space is pre-leased.
BISNOW Silicon Valley Reports, Jan. 2020.
San Jose Business Journal, Dec. 13, 2019 various pages
23. Santa Clara County
Retail Market Breakdown
23
Kidder Mathews, 2019 4Q Market Breakdown
2017 2018 2019
New Construction 812,302 432,247 203,405
Under
Construction
669,613 1,054,888 1,086,984
Vacancy Rate 3.0% 3.4% 3.3%
Net Absorption 1,215,394 81,096 280,301
24. 24
Other Local Trends
• Median Sold Price of Existing Single Family Homes in Santa Clara County. 1
Nov. 18-$1,250,000
Nov. 19-$1,259,000
• Santa Clara County Assessed Property Value 2
Net Unsecured- $30,027,967,685 Net Secured-$486,040,835,929
Total Net Role- $516,068,803,614
7 % Increase over prior year $264 per capita
• There are 28,846 vacant households in Santa Clara County.3
1 California Association of Realtors, November 2019 Sales and Price Activity
2 Annual Report of the 2019-2020 Santa Clara County Office of the Assessor
3 Janice Bitters, San Jose Spotlight, Jan. 23, 3030
25. Santa Clara County Construction
Employment-Annual Average
In Thousands
46.8 47.5
44.5
34.6 32.4 31.8
34.8
37.5 39.7 39.7
48.3 49.3 49.4
49.0
0.0
10.0
20.0
30.0
40.0
50.0
60.0
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
25
Bureau of Labor Statistics-San Jose, Santa Clara, Sunnyvale Statistical Area
November 2019 is 49,200
Peak Employment was September 2000-52,200
26. California Construction
Employment (In Thousands)
554.7 569.2 609.1
653.2 689.2
757.9
784.7
831.5
871.9
901.3
0.0
200.0
400.0
600.0
800.0
1000.0
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
26
BLS.Gov., State and Area Employment, Construction
Employment based on November Data since 2010
27. California Construction
Employment Stats 2016
27
Category Total # of Firms
1-499 Employees 70,656
1-19 Employees 64,176
Non Employer Firms 221,871
Total Small Firms in Construction 292,527
Small Business Employment by # of employees 596,094
Total Private Employment in Construction 723,574
Small Business Employment Share 82.4%
SBA, California Small Business Profile, 2019, p. 22-23