Tag Archives: cci


Despite Headwinds, Contractor Confidence On Rise

By Kinsey Cooper, Associated Builders and Contractors

Washington, D.C. – Associated Builders and Contractors’ Construction Confidence Index (CCI) shows confidence among nonresidential contractors increased slightly during the first half of 2013, despite sequestration and rising interest rates.

“As the economic recovery enters its fifth year, nonresidential construction prospects continue to brighten,” said ABC Chief Economist Anirban Basu. “A variety of industries ranging from professional and health services to leisure and retail continue to add jobs, and vacancy rates in many product categories throughout the country are falling, creating new opportunities for developers and their contractors.”
The CCI reflects three aspects of the U.S. nonresidential construction industry: sales prospects, profit margins and staffing levels. As a diffusion index, CCI readings above 50 indicate growth, while readings below 50 are unfavorable. Following are CCI indices for the first half of 2013 compared to the second half of 2012.

·         Sales expectations rose from 62.3 to 63.
·         Profit margin expectations slipped from 55.9 to 55.3.
·         Staffing level expectations rose from 59.6 to 60.

“While there is debate regarding the pace of economic expansion going forward, there seems to be little worry about another recession, implying that opportunities for contractors will continue to expand,” Basu said. “This helps explain the construction confidence readings, which have steadily expanded despite emerging reasons for concern—keeping roughly in lockstep with an ongoing gradual recovery that has averaged about 2 percent annual growth since the recession ended.”

CCI for 2012-2013

CCI for 2012-2013

“Several events have impacted the gradual increase in confidence this year, including Detroit’s bankruptcy, rising interest rates, the nation moving closer to another debt ceiling debacle and softening in the housing market.” Basu said. “However, certain aspects of the economic environment have improved, including the availability of capital and the steady healing of state and local government budgets.
“Overall, contractors are saying positive factors will outweigh negative ones, helping create an improved construction spending environment in 2014,” Basu said.
Of the three aspects of the U.S. nonresidential construction industry CCI represents, all three are above the threshold value of 50 and two are up on a year-over-year basis. Profit margins was the only category that declined.

“Contractors are likely to be busier next year, but profit margin growth will be constrained because of fierce competition. As a result, there will be substantial pressure to control costs, which implies hiring will continue to be soft, though the number of industry workers is set to expand next year,” said Basu.

The following chart reflects the distribution of responses to ABC’s most recent surveys.


Climate Positive Development Program, Below Zero Sustainable City

Living Below Zero-Creation of the Most Sustainable Cities

Unveiled in May at the C40 Cities Climate Leadership Group summit in Seoul, South Korea, the Climate Positive Development Program will help real estate developers and local governments craft 16 of the most sustainable urban communities found anywhere on Earth.

“As the Earth’s population increases and our cities grow, we need to ensure we have the models in place to sustain our way of life in an increasingly urbanized world,” said President Clinton in a statement announcing the program. He also stated that it would set “a new global standard for developments that will minimize environmental impacts and benefit economics” as new buildings are constructed and older ones are updated.

As the program’s creators, the Clinton Climate Initiative (CCI) and the USGBC are providing guidance in energy efficiency, renewable energy generation, green building construction, water conservation and other areas as the communities take shape on 6 continents.

The ultimate goal for each city is to reduce its emissions to “below zero” by not only offsetting its own emissions, but generation excess renewable power on-site that can be returned to the grid and used to offset emissions elsewhere.

Two of the planned cities are in the United States: San Francisco’s 6,000 new homes and 250,000 SF of commercial space constructed in a former U.S. Navy base in the San Francisco Bay; and Florida’s Destiny development covering more than 60 sq. miles south of Orlando, which includes a 500-acre clean tech manufacturing plant and 10,000 residential units.

CCI, which is also involved in New York’s massive Empire State Building energy efficiency retrofit, will assist project developers on the business and financial side, while USGBC provides technical guidance and helps gauge the success of the projects.


Source: Green Lede, CoStar’s green building news column. Written by Andrew Burr; May 2009.

Zero Emission City Fast Facts

  • Close to 1 million people will live and work in the completed cities
  • Half of the world’s population – 3.2 billion people – now live in cites, which consumes more than 2/3 of global energy
  • This population only occupies about 2% of the world’s land mass
  • More than 6 billion people are projected to live in cities by 2050

Source: United Nations