Institutional construction should remain steady this year and next with commercial upturn projected for 2012, according to Kermit Baker, AIA Chief Economist.

The nonresidential construction market is expected to recover this year, but late enough in the year that 2011 spending levels are unlikely to see any growth over 2010 levels. A consensus 2 percent construction spending decline in 2011 will hopefully indicate the bottom of the recession trough and set the stage for a recovery in 2012.

After falling around 30 percent on an inflation-adjusted basis last year, commercial construction is expected to see a modest decline this year, while the downturn for manufacturing should be greater. Institutional building activity is projected to stay near 2010 levels.

As the nonresidential recovery strengthens, 2012 is expected to produce stronger gains. Overall building construction should rise around 5 percent, with growth twice that rate for the more cyclical commercial sector. Spending on institutional buildings is projected to increase a more modest 1.6 percent.

– Courtesy of AIA