AIA Sees Non-Residential Rebound in 2012

Washington, DC, Jan. 26, 2011 -- The American Institute of Architects is predicting that U.S. nonresidential construction activity will decline overall this year but recover in 2012, led by the hospitality and retail sectors.

AIA said nonresidential construction spending is expected to fall by 2% this year before rising by 5% in 2012. However, some areas like healthcare are expected to be up slightly in 2011.

The projected decline marks a deteriorating outlook compared to the prior survey in July 2010, when a 2011 recovery was expected.

That recovery has been pushed back by a variety of factors, including an unfavorable bond market that has limited municipalities' access to funding, the AIA said.

Potential higher borrowing costs and rising energy prices are areas of concern for the architecture and construction industry, said AIA chief economist Kermit Baker.

Construction of industrial space is projected to fall 11.8% this year, but up slightly in areas like healthcare, church, and recreational facilities.

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