Arizona was ranked No. 5 in 2011 in direct spending in all three phases of development across all categories of commercial real estate, according to a report issued last week by NAIOP.
Arizona’s development accounts for $4.2B in spending and 74,117 jobs supported, up from No. 14 last year. Arizona’s development contributed heavily to 2011 being the first year commercial real estate (office, industrial and retail buildings) has posted gains since the recession, according to NAIOP’s report, How Office, Industrial and Retail Development and Construction Contributed to the U.S. Economy in 2011.
The NAIOP Research Foundation Study:
· Construction spending grew more than 12% from 2010 to 2011;
· 238.3 MSF built in 2011 was 2.5% more than in 2010;
· New projects provided capacity for 610,000 jobs;
· Commercial real estate development and construction contributed $262B to a GDP increase of 13% from 2010
Construction spending on commercial real estate totaled $92.3B, a more than 12% increase over 2010. This spending supported nearly 2 million jobs nationally.
“2011 was a transition year for the U.S. economy and the construction sector,” said the report’s author, economist Stephen S. Fuller, PhD, Dwight Schar Faculty Chair, University Professor and the Director of the Center for Regional Analysis at the George Mason University. “The U.S. economy shifted from a federal stimulus to private-sector driven growth pattern and construction spending grew accordingly.”
In addition to the advances made in 2011, forecasts for 2012 call for project construction spending to increase and to accelerate further in 2013 and 2014, according to the report.
“For the first time we are seeing across the board increases in this sector,” said Thomas J. Bisacquino, NAIOP president and CEO. “We believe this is the most solid evidence yet of a strengthening recovery.”
The impact of the new spending was felt throughout the nation. The following states posted the highest amounts of direct spending in all three phases of development across all categories of commercial real estate (number in parenthesis refers to that state’s rank in 2010):
1. Texas (Previous rank: 2), $7.9B in spending, 150,102 jobs supported;
2. New York (1), $6.5B in spending, 83,762 jobs supported;
3. West Virginia (48), $5.9B in spending, 100,889 jobs supported;
4. California (3), $4.5B in spending, 70,817 jobs supported;
5. Arizona (14), $4.2B in spending, 74,117 jobs supported;
6. Utah (26), $3.6B in spending, 77,550 jobs supported;
7. Florida (4), $3.4B in spending, 64,970 jobs supported;
8. Illinois (10), $3.0B in spending, 50,136 jobs supported;
9. Massachusetts (21), $3.05B in spending, 41,382 jobs supported;
10. (tie) North Carolina (7), $3.05B in spending, 55,920 jobs supported.