Everyone seems to agree that cautious optimism is warranted. The economy appears to be doing a little better, unemployment numbers and down and construction is picking up.
This bodes well for the nation but how is the Bay area doing?
According to a recent article in The Registry, the Bay Area Real Estate Journal , major players in the construction industry in the area are predicting healthy activity for the foreseeable future with one global player going as far as to say that “there will be four pace-setting years, beginning in 2012, in which construction levels top those seen in the dot-com era.”
The article also quotes McGraw-Hill construction as saying, “… after five years of flat or shrinking construction starts, the San Francisco metropolitan area is seeing expansion. The statistical area includes San Francisco, San Mateo, Alameda, Marin and Contra Costa counties. Retail, office, warehouse and transportation-building work all are up year over year. Housing construction, mostly apartments, jumped last year and this year remains well off 2009’s floor.”
Other construction heavy weights anticipate “mega projects” of $100 million or more, totaling over $10 Billion during the next few years.
The construction industry, while welcoming the renewed market vigor, is concerned about labor shortages, not to mention the possible impact on commercial real estate sales when all the new construction comes onto the market.
What’s fueling the sudden activity? Primarily Silicon Valley tech company expansion and the Bay area is not the only beneficiary. Many tech companies are also expanding their operations in other locations throughout the country. For instance, Facebook has expanded its local real estate portfolio, as well as out of state in Prineville, Oregon and internationally in Sweden.
Many of the most aggressive expansions are by organizations that already have an expanding world-wide customer base and correspondingly need to expand their real estate to allow them to better serve these areas.
Read the full article here: http://www.theregistrysf.com/RTRE_bay_area_tech_construction_1.html
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