Transcript Outlook 2008 - CMAA San Diego Chapter

2008 McGraw-Hill
Construction Outlook
Cliff Brewis
Senior Director Editorial
McGraw-Hill Construction
U.S. Macroeconomic Picture
Real GDP Growth - Quarterly
Annualized Percent Change
Change in Employment
'07 Q2
Thousands of Workers
+3.8%
2006
2007 YTD
189 K /mo. 122 K /mo.
450
8
6
300
4
150
2
0
0
-2
-150
-4
01
02
03
04
05
06
07
08
-300
01
Price of Oil
02
03
04
05
06
07
08
Consumer Price Index
Dollars per Barrel, West Texas Crude
Percent Change, Year-over-Year
5
90
80
4
70
Core CPI
60
3
50
2
40
CPI
30
1
20
0
10
01
2
02
03
04
05
06
07
08
01
02
03
04
05
06
07
08
World Growth Remains Strong
Real GDP, % change
8
6
4
2
0
US
Canada
2004
3
Source: Global Insight and S&P
Eurozone
2005
2006
Japan
2007
Other Asia
2008
Latin America
2009
U.S. Material Prices
PPI -- Construction Materials
Dec.'06Sept.'07
Index, 1982=100
+2%
190
275
160
225
145
175
130
125
01
02
03
04
05
06
PPI -- Iron and Steel Products
07
+5%
220
Index, 1982=100
00
08
01
02
-17%
03
04
05
06
PPI -- Copper & Copper Alloy
Wire & Cable Index, 1982=100
Dec.'06Sept. '07
Index, 1982=100
400
07
08
Dec.'06Sept. '07
-2%
350
200
300
180
160
250
140
200
120
150
100
100
00
4
325
175
00
Dec.'06Sept. '07
PPI -- Gypsum
01
02
03
04
05
06
07
08
00
01
02
03
04
05
06
07
08
Points of Perspective -- U.S. Construction
Total Construction by Cycle
Cyclical Trough (T) = 100, Based on Constant Dollars
200
180
160
1975-82
1991-2008
140
1982-91
120
100
80
T
T+2
T+4
T+6
T+8
T+10
T+12
Years from Cyclical Trough
5
T+14
T+16
1991- 2005
Major U.S. Construction Sectors (Starts)
Single Family Housing
Billions of Dollars
2006
2007
-14%
-25%
350
120
275
100
Commercial Building
Billions of Dollars Starts
Construction
2006
2007
+27% +7%
80
200
60
125
40
50
20
90
94
96
98
00
02
04
06
08
Public Works
2006
2007
Billions of Dollars
+17%
+5%
90
120
105
100
85
80
65
60
45
40
25
20
92
94
96
98
00
02
04
06
08
92
94
96
98
00
02
Institutional Building
Billions of Dollars Starts
Construction
125
90
6
92
90
92
94
96
98
00
04
2006
06
08
2007
+10% +4%
02
04
06
08
U.S. Single Family Housing
Supply of Single Family Housing
Single Family Housing
Thousands of Dwelling Units
Number of M onths
1,700
10
1,500
8
1,300
6
1,100
4
900
2
700
90
86
88
90
92
94
96
98
00
02
04
06
98
00
02
04
06
08
14
12
10
8
6
4
2
0
-2
11
10
9
8
7
6
5
7
96
Percent Change, Based on Median Price
Percent
92
94
New Home Prices
Mortgage Rates - Weekly
90
92
08
94
96
98
00
02
04
06
08
90
92
94
96
98
00
02
04
06
Default Rates Highest In
Midwest And South
Seriously Delinquent Rate, Q2
Under 2.47%
2.48% to 3.47%
Over 3.47%
8
Source: Mortgage Bankers’ Association
California: Single Family
$40,000,000
$35,000,000
$30,000,000
$25,000,000
$20,000,000
$15,000,000
$10,000,000
$5,000,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
$0
9
California: Single Family
Los Angeles
San Diego
4500000
3000000
4000000
2500000
3500000
3000000
2000000
2500000
1500000
2000000
1500000
1000000
1000000
500000
500000
0
0
1
10
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
U.S. Multifamily Housing
Multifamily Housing
Thousands of Dwelling Units
1,000
800
600
400
200
0
86
11
88
90
92
94
96
98
00
02
04
06
08
U.S. Income Prop.-- Multifamily Housing
Major metropolitan areas
Multifamily Housing
Top 10 Metros -- ranked by new dwelling units
Year 2007 YTD %ch 07/06
Year 2006, %ch 06/05
-0-
1. New York
2. Miami
-22%
2. Chicago
3. Chicago
+27%
3. Seattle
+44%
4. Los Angeles
+20%
4. Miami
-54%
5. Dallas-Ft.Worth
+32%
5. Orlando FL
+13%
6. Washington DC
-22%
6. Atlanta
-10%
7. Atlanta
-13%
7. Houston
+41%
8. Orlando FL
+22%
8. Los Angeles
-35%
9. Seattle
+41%
9. Washington DC
-19%
1. New York
10. Las Vegas
12
+22%
10. Boston
-49%
-34%
+1%
California: Multifamily Housing
$8,000,000
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
$0
13
California: Multi-Residential
Los Angeles
San Diego
3000000
1200000
2500000
1000000
2000000
800000
1500000
600000
1000000
400000
500000
200000
0
0
1
14
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
U.S. Commercial Bldgs. -- Stores
Stores and Shopping Centers
Millions of Square Feet
350
300
250
200
150
100
86
15
88
90
92
94
96
98
00
02
04
06
08
Borrowing Against Your Home
$700
$600
$500
$400
$300
$200
$100
$0
1994
1996
1998
2000
Home equity cashed out
16
Source: Freddie Mac
2002
2004
2006
Home equity loans
2008
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
California: Retail
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
17
California: Retail
Los Angeles
San Diego
250000
900000
800000
200000
700000
600000
150000
500000
400000
100000
300000
200000
100000
0
1
18
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
L 50000
o
0
s
A
n
g
e
l
e
s
L
o
n
g
B
e
a
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
U.S. Commercial Bldgs.-- Hotels
Hotels
Millions of Square Feet
110
90
70
50
30
10
86
19
88
90
92
94
96
98
00
02
04
06
08
California: Hotel
$1,800,000
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
$0
20
California: Hotel
Los Angeles
San Diego
1200000
600000
1000000
500000
800000
400000
600000
300000
400000
200000
200000
100000
0
0
1
21
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
U.S. Commercial Bldgs. -- Offices
Office Buildings
Millions of Square Feet
425
350
275
200
125
50
86
22
88
90
92
94
96
98
00
02
04
06
08
U.S. Commercial Bldgs. -- Offices
Office Building Factors
U.S. Office Vacancy Rates
Change in Office Employment
Thousands of Workers
1,250
25
CB Richard Ellis
Suburban
1,000
20
750
500
15
250
10
0
Downtown
-250
5
-500
-750
0
86 88 90 92 94 96 98 00 02 04 06 08
23
86 88
90 92 94
96 98
00 02 04
06 08
California: Office
$5,000,000
$4,500,000
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
$0
24
California: Office
Los Angeles
San Diego
1600000
500000
1400000
450000
1200000
400000
350000
1000000
300000
800000
250000
600000
200000
400000
150000
100000
200000
50000
0
1
25
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
U.S. Institutional -- Educational Bldgs.
Educational Buildings
Primary, Jr. Highs
Millions of Square Feet
2007 YTD
+1%
-7%
300
High Schools
+15%
-6%
250
Colleges/Univ.
+6%
+5%
200
Libraries
-1%
-7%
-24%
+20%
+2%
-7%
+43%
-12%
Vocational Schools +35%
-50%
Laboratories
150
Museums
100
Comm. Colleges
50
86
26
2006
88
90
92
94
96
98
00
02
04
06
08
U.S. Institutional -- Educational Bldgs.
Student Enrollments, Grades K-8
U.S. Higher Education Enrollments
Millions of Students
Millions of Students
45
22
42
20
39
18
36
16
14
33
12
30
10
1985
1990
1995
2000
2005
2010
2015
Student Enrollments, Grades 9-12
18
Millions of Students
16
14
12
10
1985
27
1990
1995
2000
2005
2010
2015
1985
1990
1995
2000
2005
2010
2015
California: Education
$8,000,000
$7,000,000
$6,000,000
$5,000,000
$4,000,000
$3,000,000
$2,000,000
$1,000,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
$0
28
California: Education
Los Angeles
San Diego
900000
2500000
800000
2000000
700000
600000
1500000
500000
400000
1000000
300000
200000
500000
100000
0
0
1
29
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
U.S. Institutional -- Healthcare Buildings
Healthcare Facilities
Millions of Square Feet
90
Clinics
75
60
45
30
Hospitals
15
0
86
30
88
90
92
94
96
98
00
02
04
06
08
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
California: Healthcare
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
$0
31
U.S. Institutional Buildings
Public Buildings
Amusement & Rec. Buildings
Millions of Squaare Feet
Millions of Squaare Feet
75
115
60
95
45
75
30
55
15
35
0
86
32
88
90
92
94
96
98
00
02
04
06
08
15
86
88
90
92
94
96
98
00
02
04
06
08
California: Public ex Schools
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
$0
33
U.S. Manufacturing Buildings
Manufacturing Buildings
Capacity Utilization
Millions of Square Feet
Percent
89
250
86
200
83
150
80
100
77
50
74
0
71
86
34
88
90
92
94
96
98
00
02
04
06
08
90
92
94
96
98
00
02
04
06
08
California: Manufacturing
$1,800,000
$1,600,000
$1,400,000
$1,200,000
$1,000,000
$800,000
$600,000
$400,000
$200,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
$0
35
Governor’s Strategic Growth Plan

First Five Years

Transportation
$42 Bil
Education
$24 Bil
Flood Control/Water Supply $11 Bil





Public Safety/Courts
Total
Bond Measures Passed
 Requires
$10.5 Bil
$$86.5 Bil
$43 Bil
Passage in the Legislature and
Referendums
36
California
 Legislation on Off-Road Diesel Emissions
 Product is NOT Available
 Reduce Capacity and Increase Unemployment
 Spike in 2008/Declines in 2009
 Federal Legislation/Regulation on Non-Matching
Documentation
 Tied Up in the Courts
 Availability of Federal Highway Funds
37
U.S. Public Works -- Highways & Bridges
Highways and Bridges
Billions of Dollars
60
50
40
30
20
10
86 88 90 92 94 96 98 00 02 04 06 08
38
California: Highways
$4,000,000
$3,500,000
$3,000,000
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
$0
39
U.S. Public Works -- Environmental
Sewers, Dams/ Water Resources
Water Supply Systems
Billions of Dollars
18
Billions of Dollars
Sewers
15
15
12
12
9
9
6
6
3
Water Resources
3
0
0
86 88 90 92 94 96 98 00 02 04 06 08
86 88 90 92 94 96 98 00 02 04 06 08
Dams, Water Resources
40
California: Water Supply
$2,500,000
$2,000,000
$1,500,000
$1,000,000
$500,000
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
$0
41
U.S. Total Construction Starts for 2008
Billions of Dollars
Total Construction
Single Family Housing
Multifamily Housing
Commercial Bldgs.
Institutional Bldgs.
Manufacturing Bldgs.
Public Works
42
2004
2005
2006
2007
2008
593.0
668.9
682.5
626.7
614.1
+11%
+13%
+2%
-8%
-2%
282.7
315.5
272.4
204.0
197.8
+17%
+12%
-14%
-25%
-3%
50.4
68.3
69.6
61.4
56.4
+23%
+35%
+2%
-12%
-8%
67.2
72.0
91.4
97.3
91.1
+14%
+7%
+27%
+7%
-6%
89.1
99.7
109.8
114.0
118.7
-1%
+12%
+10%
+4%
+4%
8.0
10.0
13.3
18.6
16.5
+17%
+24%
+33%
+40%
-11%
88.2
95.8
112.2
117.9
121.0
+6%
+9%
+17%
+5%
+3%
California
($,000.00)
Total
Single Family
Multi Res
Retail
Office
Hotel
Healthcare
Education
Govt ex Schls
Manufacturing
Highways
Water Supply
43
2002
2003
2004
2005
2006
2007
2008
$57,905,335 $60,313,389 $67,384,783 $72,592,696 $66,995,887 $63,836,294 $63,491,920
104.16%
111.72%
107.73%
92.29%
95.28%
99.46%
$25,744,828 $29,406,367 $33,895,245 $35,944,219 $25,693,693 $20,859,756 $19,545,347
114.22%
115.26%
106.05%
71.48%
81.19%
93.70%
$3,869,172 $4,561,693 $4,296,612 $7,069,287 $7,221,751 $6,303,186 $5,976,924
117.90%
94.19%
164.53%
102.16%
87.28%
94.82%
$1,828,735 $2,145,128 $1,999,788 $2,324,478 $2,079,888 $2,307,546 $2,307,074
117.30%
93.22%
116.24%
89.48%
110.95%
99.98%
$2,329,456 $2,139,076 $2,093,901 $2,173,928 $3,294,791 $3,347,256 $3,442,344
91.83%
97.89%
103.82%
151.56%
101.59%
102.84%
$525,443
$711,608
$508,221
$888,100 $1,185,494 $1,601,311 $1,374,858
135.43%
71.42%
174.75%
133.49%
135.08%
85.86%
$1,349,460 $1,205,749 $1,449,643 $2,159,201 $2,051,224 $2,350,010 $2,230,188
89.35%
120.23%
148.95%
95.00%
114.57%
94.90%
$4,269,457 $5,969,607 $6,326,138 $5,711,288 $6,539,227 $5,563,798 $7,306,909
139.82%
105.97%
90.28%
114.50%
85.08%
131.33%
$830,412
$559,207
$787,881
$814,806
$908,075
$729,557 $1,143,863
67.34%
140.89%
103.42%
111.45%
80.34%
156.79%
$283,190
$340,169
$726,554
$388,216
$648,561 $1,166,586 $1,356,224
120.12%
213.59%
53.43%
167.06%
179.87%
116.26%
$2,667,119 $2,300,132 $2,459,312 $2,600,646 $3,618,628 $3,533,557 $3,465,719
86.24%
106.92%
105.75%
139.14%
97.65%
98.08%
$1,771,489 $1,244,774 $1,692,474 $1,925,409 $1,724,236 $1,741,476 $1,934,066
70.27%
135.97%
113.76%
89.55%
101.00%
111.06%
Questions?
Cliff Brewis
Senior Director Editorial
McGraw-Hill Construction
[email protected]
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