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A.R.E.: Good times ahead, especially for retail construction


New York -- The Association for Retail Environments is bullish on the future.

The organization is predicting good days ahead for the U.S. economy in general and retail construction in particular. According to A.R.E.’s economic advisors, all indicators show that the 2016 economy in the U.S. will grow faster than it did in 2015. And while economic growth will slow in the back half of 2015, it will not be negative.

“As an industry, we have been experiencing a recession hangover, where decisions to start projects come a bit slower than pre-recession practices,” said Todd Dittman, A.R.E.’s executive director. “Yet the construction industry has been growing around 3.5% to 4.5% this year.”

A.R.E. pointed out the following trends:

• The growth in retail construction will slow down from 10% rolling 12 months, but will pick back up again in 2016.

• Opportunity areas in retail construction are with the luxury brands, dollar stores, and warehouses.

• Due to the online shopping trend, warehouse construction is up 52.3% this year.

• Retail construction trends continue to show smaller footprints in urban settings.

Manufacturing also looks promising in 2016, according to A.R.E. North America is leading the way with the U.S. up 3.8% and Mexico up 3.7% this year. Drivers include near sourcing (customer orders coming back to the U.S.), improved technology, leveling of capital vs. labor costs, cheaper energy costs, and improved production efficiencies.

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