FMI Releases Nonresidential Construction Index for Third Quarter 2010
August 27, 2010
FMI Corp., a provider of management consulting and investment banking to the worldwide construction industry, released its nonresidential construction index (NRCI) for the third quarter of 2010. At 51.3 for the third quarter of 2010, the NRCI is in growth territory for the second quarter in a row; however, it retreated somewhat from the more 54.5 last quarter, according to the company release.
FMI Corp. says states and municipalities are expected to make significant budget cuts due to lower tax revenues next year, and the federal stimulus support for the market will start to wind down over the next year. It adds that the concern now is that banks and private investors are sitting back and waiting for stronger signs of economic improvement until they repair their balance sheets.
In its report, FMI asked if owners were showing more interest in improvements and alterations projects. It noted that fifty-nine percent of panelists said owners were increasing their interest in projects for general modernization, energy improvement, green and sustainable upgrades and other projects. While this work will not replace new construction business lost in the recession, it will provide new markets for some contractors.
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