US non-residential construction spending climbs

18 April 2007 15:35  [Source: ICIS news]

HOUSTON (ICIS news)--The March architecture billings index (ABI) - an economic indicator of US construction activity - shows continued growth in the non-residential sector, a trade group said on Wednesday.  

 

The American Institute of Architects (AIA) said the March ABI rating showed steady but slow growth at 52.6 (any score above 50 indicates an increase in billings). The March index showed a year-on-year rise of 2%.

 

With significant enquiry levels for new projects, this news underlined the favourable forecast for the non-residential construction market throughout 2007, AIA spokesman Scott Frank said.

 

The institute forecast a 7% increase in non-residential construction spending in 2007, which should help offset the weakness in the residential sector, Frank added.

 

“Architecture firms are reporting more stable business activity and in some cases are being forced to increase their project backlogs of commercial and institutional projects because of heavy demand for design services over the last 18 months,” said AIA chief economist Kermit Baker.

 

The construction sector is a key downstream consumer market for the chemicals industry, driving demand for a wide variety of chemicals and chemicals-based products such as plastic pipe, insulation, paints and coatings, adhesives and synthetic fibres, among many others.

 

Chemical-makers had been concerned the downturn in the US home building industry would affect markets but the AIA said the non-residential growth would more than offset the weakness in the housing sector.

By: Heather McGuire Doyle
+1 713 525 2653

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