By: Dr. Stephen S. Fuller
Release Date: December 2010
The value of commercial buildings is much more than the sum of their construction outlays or their assessed valuation. Commercial real estate development, construction and operations create a ripple effect in the economy. This contribution consists of annual direct spending for new development and construction and annual expenditures to operate existing buildings. Additional important economic benefits - the ripple effect - are also derived from the re-spending of the salary and wages supported by direct construction and operating outlays and purchases of construction-related materials and services from vendors. The combination of these direct and indirect (and induced) outlays constitutes the total output or contribution to the national economy.
The report is intended to provide a document that can be used to demonstrate the economic importance of commercial construction to local, state and national audiences as the national economy begins to recover. Dr. Fuller compares and contrasts the 2007 and 2008 data in the previous two reports emphasizing the stronger jobs connection between construction and the recovery and future growth opportunities in preparing for the next cycle. The objective of this research project is to provide a report that can be used to explain the economic and fiscal importance of commercial buildings to local, state and national audiences.