Office, Infrastructure Demand Will Sustain Canada's Construction Boom In 2008

According to the report, residential homebuilding in Canada is levelling off. Real residential construction expenditures stalled in the first half of 2007, marking the first time in almost a decade that the industry failed to contribute to GDP growth. Housing starts will likely drift lower in the year ahead as reduced affordability and rising mortgage rates dampen home sales and builder confidence. For the time being, however, the broad construction sector will remain an important contributor to growth. Renovation activity should remain buoyant given record existing home sales this year. A nationwide resurgence in commercial, resource and infrastructure investment will also help to sustain the momentum. Investment in non-residential buildings and structures, at $114 billion in 2006, exceeds residential construction and renovation expenditures by almost 40 per cent. ... Engineering construction, on the other hand, is expected to remain in high gear. Governments at all levels are shoring up aging public infrastructure, including roads, bridges, public transit and power utilities. Energy and mining related outlays will continue to drive private sector activity, underpinned by high commodity prices and strong global demand. "From a regional perspective, relative economic and demographic trends suggest the hottest markets for both residential and non-residential activity will continue to be found in the resource-rich regions in the West, East and North," said Warren. "Many businesses in the manufacturing-dominated economies of Central Canada may choose to focus on raising efficiencies through modernization efforts and increased machinery & equipment investments as opposed to generating additional capacity." http://www.newswire.ca/en/releases/archive/November2007/07/c4792.html

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