2011 Commercial Construction and Real Estate Cost Forecasting

2011 Commercial Construction and Real Estate Cost Forecasting

Everyone knows that the commercial construction industry got hammered after the global financial meltdown. And it really hasn't recovered very well, and although the residential housing market got hit quite a bit harder than the commercial sector, there are plenty of unoccupied buildings with no tenants, unoccupied high-rises, and empty warehouse buildings. The question is, as we are moving into 2011; how does the industry look now?

Is there any money to be made in commercial construction in 2011? Yes and no, and most of the industry believes it will be a rebuilding year. Luckily, Land Costs should remain relatively decent in most US markets. Still, we can expect labor costs to skyrocket - mostly due to increases in illegal immigration enforcement, meaning sub-contractors will be hiring US citizens not cheap labor and paying them under the table. Plus, let's not forget the realities of the new ObamaCare phase-ins on health insurance.

Many Municipalities and County Governments are requiring LEEDs construction techniques and energy efficient structures. Some states are putting overlay laws on top of local ordinances, building codes, rules, and regulations. That will certainly drive up costs. Also, in some cases Union Labor may often be required because they will be the only folks certified to build LEEDs standard buildings.

But, those are not the only considerations, as you can expect Workmen's Compensation insurance is only going one-way, and that's up. And then there are materials, which must be considered in the cost analysis also. Chinese made materials such as aluminum, steel, and other products could be hit with significant tariffs and many building materials from China have already have been due to anti-dumping filings at the WTO.

Yes, 2011 will be a rebuilding year, but it will also be a wa

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