The opinion of many economists and business leaders in Arizona seems to be that this year marks a year of economic re-growth. It definitely will not happen overnight, but there should be definable improvements for everyone. The construction industry deserves attention when talking about an improving economy because they have felt the harsh effects of the recession as much or more than anyone else. Building development characterized the economic boom that led up to the recession, and trouble in the real estate markets were the first factors cited when the recession was being defined.
Tens of thousands of workers in Arizona depend upon a healthy real estate market to make a living. What opportunities await this hard working segment of our state economy in 2011?
Optimism in 2011
- Commercial Sector- A recent post by the Phoenix Business Journal cites commercial property as a real opportunity for construction companies in 2011. Favorable corporate tax rates and competitively priced leases are making Phoenix–and other cities in Arizona–a location that cannot be ignored by large businesses. Arizona is geographically located in the West but comes without the price tag that many of our neighboring states have, making Arizona a formidable West Coast distribution point or headquarters. While there probably won’t be a lot of bids taken for new construction next year, you would be advised to look out for all of the remodeling work that will be out there. When large companies move in, they will need offices and manufacturing facilities redesigned to suit their needs. Commercial build-outs should keep a lot of contractors afloat in 2011.
- Home Segment- Opinions are mixed, but many in the real estate market are predicting 2-3% increases in home values in most states, not just Arizona, next year. As this happens people will begin to have a little more faith in the economy and likely some extra disposable income to go with it. Again, new development is less than likely, but contractors will again have the opportunity to get into the renovation market. Many people will probably stay in their homes longer from here on out, making remodeling a very enticing prospect for consumers so long as they can get a line of credit for the renovations.
Coaxing businesses from other states will be instrumental in an upturn for the building industry statewide in Arizona. New companies mean more work, not just for the construction industry, but for everyone else as well, once the local economy starts to churn a little faster. With thoughtful decisions and a focus on growth, 2011 should be a better year for employers from Tucson to Tempe.