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The US commercial construction market size is forecast to increase by USD 182.3 billion at a CAGR of 2.6% between 2023 and 2028. The commercial construction market in the US is experiencing significant growth, driven by several key trends and factors. One of the primary drivers is the increasing demand for green buildings, as sustainability becomes a priority for businesses and governments alike. Another trend is the emergence of smart cities, which require advanced infrastructure and commercial spaces to support their technological innovations. However, the construction industry faces a major challenge in the form of a workforce shortage, which can hinder project completion timelines and increase labor costs. To mitigate this issue, industry players are exploring solutions such as automation, offsite construction, and training programs to attract and retain skilled workers. Overall, these trends and challenges present both opportunities and challenges for commercial construction market participants in the US.
The market is experiencing significant growth, driven by the need for repair and maintenance, refurbishment, and demolition of office buildings, retail buildings, and outdoor leisure facilities. Urbanization and infrastructure development programs are also fueling the demand for new construction projects, particularly in mixed-use developments. However, the market faces challenges such as cost escalation due to fluctuating material prices, labor shortages, and a shrinking labor force. Energy-saving designs and renovation and retrofitting are becoming increasingly popular to reduce operational costs and enhance sustainability. The non-residential building market includes the construction of warehouses, data centers, hotels, and other structures, with water infrastructure projects also gaining importance. Building material prices, including lumber, and product lead times are also impacting the market, with the Federal Reserve's inflation and interest rate policies adding to the uncertainty.
The market research report provides comprehensive data with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.
The Private construction segment is estimated to witness significant growth during the forecast period. The commercial construction market in the US encompasses the repair and maintenance, refurbishment and demolition, and new construction of various structures, including office buildings, retail establishments, and outdoor leisure facilities. In 2023, the private non-residential segment, which comprises these types of projects, experienced significant growth due to escalating investments in urbanization and infrastructure development programs. Notable projects, such as the El Paso VA Health Care Center in Fort Bliss, mark the groundbreaking of new office facilities. Urban regeneration and mixed-use developments are further driving the market's expansion. However, the market faces challenges such as cost escalation due to fluctuating material prices, labor shortages, and shrinking labor forces.
Furthermore, energy-saving designs, renovation and retrofitting, and infrastructure projects, like roads, bridges, public transportation, broadband internet, and electric grid reconstruction, are also part of the commercial construction landscape. Warehouses, data centers, hotels, and other non-residential buildings, such as schools and hospitals, are also undergoing construction, with lumber and building material prices, as well as product lead times, impacting project timelines. The Federal Reserve's inflation and interest rate policies, along with infrastructure bills, also influence the market's dynamics.
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The private construction segment accounted for USD 1,298.20 billion in 2018 and showed a gradual increase during the forecast period.
Our market researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
An increase in the construction of green buildings is the key driver of the market. The commercial construction market in the US is witnessing significant growth, particularly in sectors such as multifamily housing, lodging, communications, and smart cities. In the context of smart cities, the focus is on enhancing communication linkages, data and communication technologies, and operational efficiency in functional areas such as road network systems, public safety, and service delivery.
Furthermore, the federal government is providing grants to promote the adoption of green infrastructure, including the Greenhouse Gas Inventory (GHGI) program, which incentivizes the installation of EV units and energy-efficient commercial production. The integration of advanced technologies in commercial construction is crucial to reducing energy consumption and carbon emissions, making buildings more sustainable and cost-effective in the long run.
The emergence of smart cities is the upcoming trend in the market. The commercial construction market in the US is witnessing significant growth due to the increasing adoption of smart city projects. These initiatives focus on enhancing operational efficiency, service delivery, and public safety through the integration of advanced communication linkages, data and communication technologies, and functional areas such as transportation and traffic management.
Furthermore, the federal government's investment in smart city projects, including the expansion of road network systems, is expected to create lucrative opportunities for commercial construction companies. Furthermore, the development of multifamily housing, lodging, and communication infrastructure is also anticipated to boost market growth. The integration of electric vehicle (EV) units and Geographic Information Systems (GIS) in these projects will further enhance the sustainability and efficiency of commercial construction in the US.
The lack of workforce in the construction industry is a key challenge affecting the market growth. The commercial construction market in the US is experiencing significant growth, with increasing spending in various sectors such as multifamily housing, lodging, communications, and smart cities. The demand for data and communication technologies in functional areas like road network systems, public safety, operational efficiency, and service delivery is driving this growth.
However, the market faces a substantial challenge due to the shortage of skilled workforce. This issue is particularly acute in the construction industry, where there is a high demand for technicians, site managers, and plumbers. As a result, companies are unable to accept new orders, hindering market expansion. The situation is further complicated by the need for advanced technologies, such as those used in Smart Cities, which require specialized expertise. To address this issue, the US government has initiated programs like Federal grants and GISI to encourage the adoption of EV units and promote workforce training.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator's stage to the laggard's stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Clark Construction Group LLC - The company offers building and construction of facilities across the US The key offerings of the company include commercial construction such as offices, hotels, resorts, and others.
The market research and growth report includes detailed analyses of the competitive landscape of the market and information about key companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market in the US is experiencing significant growth, driven by urbanization and the need for infrastructure development programs. This includes repair and maintenance, refurbishment and demolition of office buildings, retail buildings, and outdoor leisure facilities. Renovation and retrofitting of urban regeneration projects and mixed-use developments are also gaining popularity. Infrastructure building, such as roads, bridges, public transportation, broadband internet, electric grid reconstruction, and water infrastructure, are key areas of investment.
Furthermore, energy-saving designs are becoming increasingly important in the non-residential segment, including warehouses, data centers, hotels, and other commercial buildings. However, the market faces challenges such as cost escalation due to fluctuating material prices, labor shortages, and shrinking labor forces. Building material prices, particularly for lumber and other essential supplies, have seen significant increases, leading to longer product lead times. The Federal Reserve's inflation concerns and the potential for further interest rate hikes could also impact the market. Overall, the commercial construction market is expected to continue its growth trajectory, with investments in infrastructure and energy-efficient designs driving demand.
Market Scope |
|
Report Coverage |
Details |
Page number |
124 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 2.6% |
Market growth 2024-2028 |
USD 182.3 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
2.5 |
Key companies profiled |
ACS Actividades de Construccion Y Servicios SA, AECOM, Bechtel Corp., Clark Construction Group LLC, Clayco, DPR Construction, Ferrovial SA, Fluor Corp., Gilbane Inc., Hensel Phelps, HOCHTIEF AG, Holder Construction Group LLC, Kiewit Corp., Parsons Corp., PCL Constructors Inc., Skanska AB, STO Building Group, The Walsh Group, and Tutor Perini Corp. |
Market dynamics |
Parent market analysis, market growth inducers and obstacles,market forecast , fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, market condition analysis for the forecast period |
Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
We can help! Our analysts can customize this market research report to meet your requirements Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Sector
7 Market Segmentation by Type
8 Customer Landscape
9 Drivers, Challenges, and Opportunity/Restraints
10 Competitive Landscape
11 Competitive Analysis
12 Appendix
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