Commercial Building Contractors
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 130,600 commercial building contractors in the US coordinate resources and manage the building process for industrial, commercial, and institutional projects. About 71% of contractors are sole proprietors or entities without workers on payroll. Most commercial building contractors rely heavily on subcontractors.
Dependence on Subcontractors
Commercial building contractors are dependent on subcontractors for specialized activities, such as electrical, plumbing, or mechanical work.
Competitive Pricing Environment
Most commercial construction jobs are competitive bidding situations, and price is a major deciding factor in which commercial contractor obtains the job.
Industry size & Structure
A typical commercial building contractor employs about 22-23 workers and generates $13 million annually.
- The commercial building contracting industry consists of 130,600 companies that employ 806,900 workers and generate $471 billion annually.
- About 71% of contractors are sole proprietors or entities without workers on payroll.
- Most commercial building contractors rely heavily on subcontractors.
- Large companies include Turner Corporation, Tutor Perini, Jacobs Engineering, and Gilbane Building Company.
Industry Forecast
Commercial Building Contractors Industry Growth
Coronavirus Update
Nov 3, 2021 - Surge In Biotech Sector Construction Isn’t Problem-free
- Conversion of empty office and industrial space to biotechnology laboratories in Greater Boston, MA, is driving a rebound in the region’s commercial real estate market following the pandemic, but not everyone wants a laboratory next door. Opposition is increasing amid the early stages of a massive wave of renovations and retrofits, with 10 million square feet of office and industrial space in Greater Boston being converted for use by the life sciences industry. A common complaint revolves around the hefty HVAC systems that lab buildings need. They can be noisy and tall, sometimes 30 feet or more on a rooftop, an intrusive change for residential buildings nearby. Some critics also worry about safety in spaces where potentially hazardous materials are handled. Others dislike the labs’ round-the-clock operations, with foot traffic and lights at all hours. Some of these conflicts may get resolved in the courts. In one of the first legal disputes, the owner of a five-story building in South Boston sued the city’s Zoning Board of Appeal over the denial of a lab conversion.
- The Dodge Momentum Index increased in September to 164.9 (2000=100) from the revised August reading of 148. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The commercial planning component increased 13% in September, while the institutional component increased 8%. The strength in projects entering planning was widespread during the month, with most sectors moving higher.
- Lower lumber prices have reignited demand for building projects. Demand is increasing "most notably in the commercial segment and into the multifamily unit segment," according to Kyle Little, CEO of wholesale distributor Sherwood Lumber. Little said current lumber prices make "absolute sense" after the industry’s recovery from pandemic-driven sell-offs in the first and second quarters of 2020. Lumber cost about $677 per thousand board feet on October 7, according to Business Insider.
- Total commercial construction spending was unchanged in value month over month on an adjusted basis but increased 10.3% in value year over year on an unadjusted basis in September.
- Spending on nonresidential building projects is declining and will do so through 2021, according to a mid-year update to the American Institute of Architects’ (AIA) Consensus Construction Forecast. The AIA estimates an 8% spending drop in 2020 and just under 5% in 2021 due to pandemic-induced economic disruptions. This is the first time in nearly a decade that nonresidential construction spending has trended downwards, according to the AIA.
- Employment in the commercial building industry was unchanged year over year in August.
Get A Demo
Vertical IQ’s Industry Intelligence Platform
See for yourself why nearly 40,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.
Build valuable, lasting relationships by having smarter conversations -
check out Vertical IQ today.