US Total Nonresidential Construction boomed in 2023 and 2024, riding on government stimulus, onshoring trends that required new factories, and a surge in data center demand. However, 2025 has been a different story, with overall Nonresidential Construction declining to near year-ago levels.
What are the main themes we are seeing in nonresidential construction? First, there are the disparities between private and public; the private sector has recently dipped into Phase D, Recession (down 2.3% from one year ago), whereas the public sector is still up 5.7% from one year ago but slowing in growth.
On a more granular level, some markets are booming, while others are seeing less demand in this uncertain economic environment. Data centers are up a notable 45.8% from year-ago levels, while multi-retail construction (i.e., shopping centers) is down 14.2% as consumers grapple with high prices.
Firms need to be attuned to these disparate trends, as well as to what’s next for Nonresidential Construction, to maximize profits during this business cycle.
Join Connor Lokar in this July Insider Webinar to see where Nonresidential Construction is headed and why, as well as which CRE sectors are worth watching. The webinar will also cover the state of the construction labor market, and we will provide an update on the inflationary pressures impacting construction.
This webinar recording is an Insider member exclusive! Learn more and sign up today to receive this complimentary recording later this month.