Exceptionally strong growth in nonresidential building spending projected for 2023; slower gains predicted for 2024

According to AIA’s Consensus Construction Forecast

WASHINGTON – The American Institute of Architect’s (AIA) Consensus Construction Forecast panel has optimistic projections for nonresidential building spending in late 2023 and beyond, and the news is generally positive – with a caveat. The panel—comprised of leading economic forecasters—is projecting that spending on buildings will increase by 20% this year—a torrid pace not seen since the construction boom years leading up to the Great Recession. 


“The forecast for nonresidential construction activity remains healthy through the second half of 2023 and into 2024,” says AIA Chief Economist Kermit Baker, PhD, Hon. AIA. “The industry got off to an extremely strong start in the first half of the year, and that momentum will ensure healthy gains for the year before moving to a much more moderate pace of expansion in 2024.” 

Leading the charge is the manufacturing sector, where spending is projected to increase more than 50% over last year’s exceptional performance. Healthy gains are expected across all sectors, including commercial, institutional, and industrial construction categories, with each projected to increase at a double-digit pace. 

Though spending on nonresidential buildings increased by more than 10% last year, once inflation is factored in, real increases were much lower. This means that while companies are investing heavily in new buildings and renovations this year, their investments may not translate into comparable economic growth or employment opportunities. However, with inflation in construction moderating, there is optimism among industry professionals about what lies ahead for nonresidential building projects this year and beyond.

See Also

Market Segment Consensus Growth Forecasts20232024
Overall nonresidential building19.7%2.0%
Commercial 11.2%-1.7%
Office space8.0%-1.4%
Retail & Other Commercial 10.8%-2.8%
Industrial total55.1%5.4%
Institutional total 10.0%3.6%
Healthcare facilities10.4%3.0%
Public safety3.9%5.3%
Amusement / recreation10.2%1.9%

About AIA

Founded in 1857, AIA consistently works to create more valuable, healthy, secure, and sustainable buildings, neighborhoods, and communities. Through more than 200 international, state and local chapters, AIA advocates for public policies that promote economic vitality and public wellbeing.

AIA provides members with tools and resources to assist them in their careers and business as well as engaging civic and government leaders and the public to find solutions to pressing issues facing our communities, institutions, nation, and world. Members adhere to a code of ethics and conduct to ensure the highest professional standards.

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