from Mark Smith, Advocate, California Builders Alliance
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Construction starts increased by 3.1% in September, reaching a seasonally adjusted annual rate of $1.26 trillion, according to Dodge Construction Network. Nonresidential building starts rose by 11.9%, driven by commercial projects and data centers, while nonbuilding starts fell by 6.2%. On a year-to-date basis, total construction starts are up by 3.5%, with nonresidential up by 5% and residential down by 4.2%.
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The American Institute of Architects' Architecture Billings Index dropped to 43.3 in September, the lowest since April, indicating a continued decline in billings. The Midwest performed the best regionally, while the West lagged. The commercial, industrial and institutional sectors also reported weak scores.
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Full Story: The Architect's Newspaper |
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Global construction equipment sales are expected to decline by 2% this year, following a 2% drop last year, according to Off-Highway Research. The market has been adjusting to more sustainable levels after a peak in 2021 driven by low interest rates and government stimulus. China is expected to see 12% growth this year, primarily from electric equipment sales, but the real estate market remains distressed. Europe continues to struggle with high interest rates and political instability, while North America faces uncertainty due to tariff policies.
The US office market is showing signs of recovery, entering a growth cycle as vacancy rates declined for the first time since early 2019, according to JLL. The national office vacancy rate fell to 22.5% at the end of the third quarter, with leasing activity at 82% of pre-pandemic levels. Gross leasing volume increased 6.5% quarter over quarter to 52.4 million square feet, with 18 markets exceeding pre-pandemic leasing activity. The resurgence is attributed to return-to-office mandates and minimal new construction.
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States aren't disclosing billions of dollars in deferred maintenance, according to Volcker Alliance, which estimates the national backlog at $1 trillion, or 4% of GDP. Standardized state disclosure policies are needed to improve long-term infrastructure planning and prevent costly crises, according to the report series. For example, California provides detailed annual reports, while Oklahoma lacks a consolidated figure.
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Full Story: Engineering News-Record (tiered subscription model) |
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Mental health issues among construction workers are on the rise, with 64% experiencing depression or anxiety in the past year, up from 54% in 2024, according to a survey by Clayco. "The unfortunate reality is that the long hours, physically demanding work and a male-dominated and stoic culture that discourages many from discussing mental health make construction workers, and executives, more susceptible to mental health issues when compared with many other professions," said Darcy Gruttadaro, chief innovation officer at the National Alliance on Mental Illness.
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Full Story: WXYZ-TV (Detroit) |
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The Project Stress Index from ConstructConnect shows that construction project stress decreased for the third consecutive month, with project abandonments and bid date delays declining, but projects on hold increased. Public construction faces challenges due to federal funding cuts, particularly in education and municipal projects, leading to a rise in public project abandonments and on-hold activities.
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Full Story: Construction Dive |
Contractors are keen on using artificial intelligence to improve operational efficiency and productivity, but they face significant internal challenges, according to BuiltWorlds' 2025 Annual AI Benchmarking Report. The report notes that 62% of respondents cite concerns about data privacy and security, 58% highlight a lack of internal expertise, and 56% point to limited data quality as major obstacles. Despite these hurdles, larger contractors are more likely to report advanced AI adoption, with companies like Skanska and Granite Construction leading the way with innovative AI tools.
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Full Story: Construction Dive |
Infrastructure funding is a key issue in the upcoming off-year elections, with major ballot measures in states such as New Jersey, Virginia, Texas and New York. New Jersey's gubernatorial race features Rep. Mikie Sherrill, who supports transportation projects, and Jack Ciattarelli, who promotes an all-of-the-above energy policy. In Virginia, former Rep. Abigail Spanberger backs clean energy, while Lt. Gov. Winsome Earle-Sears has not clarified her stance on infrastructure. Local measures include a $1.9 billion bond in Columbus, Ohio, and an $895 million proposal in Denver.
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Full Story: Engineering News-Record (tiered subscription model) |
US cities are warning that proposed changes to the tax-exempt status of municipal bonds could increase borrowing costs and slow down infrastructure projects. The National League of Cities reports that 46% of municipalities rely on bonds for capital projects and that 84% of their budgets are already strained. The NLC says that revoking tax exemptions could delay or reduce the scope of infrastructure projects, highlighting the importance of maintaining the current tax status to support local construction.
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Full Story: Engineering News-Record (tiered subscription model) |
The Supreme Court has increased its use of the "shadow docket," issuing unexplained orders that often favor the Trump administration. Legal experts note that these orders are temporary and not final rulings, but they can significantly impact policy. The current Supreme Court term includes cases challenging a Labor Department rule on prevailing wages and climate-related lawsuits against fossil fuel companies.
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Full Story: Engineering News-Record (tiered subscription model) |
Trackunit has introduced the Kin T200, a Bluetooth asset tracker with a five-year battery life designed to endure harsh construction site conditions. The device, which does not require a gateway system or pairing, offers real-time location tracking, notifications for off-site movement, and impact and temperature sensing.
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Full Story: Equipment World |
The rise of artificial intelligence is transforming data center construction, requiring flexible infrastructure to accommodate varying customer needs for power, space and cooling. "AI data centers require specialized approaches that go far beyond traditional design considerations and project management approaches," writes Tony Qorri, DataBank's vice president of construction. "In some cases, they present logistical and technical complexities that didn't exist just a short time ago."
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Full Story: Construction Dive |
Fresno, Calif., is experiencing a construction boom that is expected to continue, with new starts forecast to exceed $2.5 billion by 2026, driven by nonresidential building, including health care and education projects. Turner Construction is building the $300 million Medical Education Building for UC Merced, and there are multiple tribal casino projects planned or under construction. However, challenges such as supply chain issues and funding for the state's high-speed rail project remain.
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Full Story: Engineering News-Record (tiered subscription model) |
A $36.6 million pavement upgrade project has been completed on the New York State Thruway in Orange County, N.Y., improving safety on a 48-lane mile stretch from Woodbury to Newburgh. Crisdel Group was the contractor for the project, which included full and partial depth repairs, asphalt overlay, new guiderails, reflective line striping and drainage upgrades. The Thruway Authority plans to invest $2.7 billion in infrastructure through 2029.
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Full Story: Construction Equipment Guide |
McCarthy Building has started construction on a $94 million Student Services building at San Bernardino Valley College, aiming for completion by spring 2027. The 104,000-square-foot building will include offices, counseling, health services and a veteran's center. The project aims to hire 50% local workers and is targeting LEED Platinum and Envision Gold certifications.
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Full Story: Construction Dive |
Southern California is seeing a surge in health care-related construction, driven by an aging population and the need to comply with seismic safety regulations. Notable projects include the $1.8 billion redevelopment of Harbor-UCLA Medical Center by HMC Architects, CO Architects and Hensel Phelps; the all-electric UCI Health - Irvine campus by CO Architects; and the $912 million expansion of Riverside Community Hospital by HKS Architects.
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Full Story: Los Angeles Times (tiered subscription model) |
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Mark Smith
Advocate
California Builders Alliance
5370 Elvas Avenue ǀ Sacramento, CA 95819
Cell: 916.335.5072
Email: mark.smith@calbuilders.org
Email: mark@smithpolicygroup.com
