Archive for September, 2012

Energy Production an Election Battleground

Monday, September 10th, 2012

The Democrat and Republican parties tend to differ greatly on the best approach to energy production and use. However, just four years since the GOP was chanting “Drill, baby, drill,” and the Dems were howling against the Bush Administration’s approach to global warming and pushing aggressive renewable energy goals, the sides have managed to find more common ground in Election 2012.

A September 5 article in the Houston Chronicle, headlined “Democratic Party platform touts natural gas, tones down climate change talk,” reports:

In the party platform they unveiled [September 4], Democrats draw a distinction between “Big Oil” and “cheap, abundant natural gas” they tout as “helping to bring jobs and industry back to the United States.”

At the same time, the Democratic platform tones down its assessment of the severity of global warming and what the United States should be doing to arrest it — a big turnaround from four years ago, when the party warned that “the epochal, man-made threat to the planet” of climate change had to be halted.

The changes reflect two economic realities:

The recent surge in domestic production of natural gas from dense rock formations across the country  is bringing jobs to Ohio, Pennsylvania and other battleground states.

At the same time, the ailing economy nationwide has made broad initiatives to combat global warming — including cap-and-trade programs that would put a price on carbon dioxide emissions–a tough sell in the nation’s capital.

Both Republicans and Democrats have linked economic gains to domestic gas production.

The GOP hasn’t moved as much in its energy platform as the Democrats have, but the party’s views on the issue have “evolved.”

An excellent analysis of the competing platform in the Casper Star-Tribune - headlined “Where do the Dems and GOP stand on energy and the environment?” - notes:

Both the Republican and the Democrat party faithful highlighted energy policy and environmental issues in their platforms. That’s not unusual. But take note what they say, and how it compares to their platforms written four years ago.

Some things sound the same and some are very, very different. And while both parties seek some identical things — energy independence, energy efficiency, a balance of energy development and environmental protection — the devil, as always, is in the details.

The gap between their views may be smaller, but the “details” illustrate that the sides still differ greatly in their overall approach.

What does this mean for energy development in general and the AEC industry in particular? A lot depends on who wins in November.

The emergence of plentiful natural gas reserves appears to have softened the Democrats’ push for renewable energy sources such as wind and solar, but these remain a critical element of the party’s energy approach.

Republicans, likewise, seek to end reliance on foreign oil and strive for a “sustainable energy future.” However, as in 2008, their timetable is not as ambitious.

Energy is a major issue, not only in the 2012 election, but in the fate of the AEC industry’s rebound in 2012. Our 2013 Guide to the U.S. AEC Markets delves deeper into the issue and offers our views on which elements of the market will thrive and which will struggle. To pre-order the publication at a discount, click on the icon at the top right and pay with your major credit card.

Has Housing Plummet Struck Bottom or Is A Shadow Looming?

Friday, September 7th, 2012

One of the first rules of market research is to consider the source. So, when trying to decide which side is right in the housing bottom debate – the optimists who say that the freefall in prices and sales has ended or the naysayers who focus on the shadow inventory of foreclosed and underwater homes – it is important to remember this rule. 

In an article headlined “Homes Selling More Quickly, Time on Market Down with Tighter Supplies,” economist Lawrence Yun shows that he is in the former camp. “A notable shortening of time on market began this spring, and this has created a general balance between home buyers and sellers in much of the country.”

Yun’s employer is the National Association of Realtors®, who would like nothing more than to see the housing crisis nightmare end. Not only does Yun argue that the price dive has reversed itself, he cautions that a housing shortage may be in the offing.

“Ironically, if housing construction doesn’t pick up to normal levels within two years, supply shortages could be sustained for an extended period and lead to above average appreciation,” Yun said. “Therefore, any unnecessary hindrance to housing starts, such as excessive local zoning regulations or stringent bank capital rules for construction loans, should be carefully re-examined.”

Not everyone shares this outlook. A June 26 article on the Forbes magazine web site reports “10 Million Underwater Mortgages And Shadow Inventory Worth $246B Mean Housing Trouble.”

The lead paragraph under this ominous headline begins, “Don’t be so sure the housing market is on its way back to health.  Despite the first monthly increase in home prices in 7 months, as the Case-Shiller indexes showed on [6/26/12], there are still more than 10 million properties with underwater mortgages, and a shadow inventory of 1.5 million, or four months supply.  Negative equity will continue to take its toll on consumption, while the shadow inventory, worth about $246 billion according to CoreLogic, will constrict lending and probably affect banks’ earnings.”

What could Forbes’ motive be for the negative spin? It’s hard to say, but Charles Tatum, a cynical reporter played by Kirk

Douglas in a 1951 film called “Ace in the Hole,” said, “Bad news sells best.” Trust me, it’s a credo that many newspapers and magazines live by.

This is not to suggest that either of these organizations are being dishonest or falsifying data to achieve the results they want. Both viewpoints are well supported by facts. It’s just how they choose to interpret these facts and data that the researcher must question.

An objective look at this issue suggests that the truth – as is often the case – likely lies somewhere in the middle.

The residential market’s importance to the overall health of the AEC industry and U.S. economy is a major theme in our upcoming release – The 2013 Guide to the U.S. AEC Markets. Even firms that don’t work in the single-family or multifamily residential space are significantly affected by its performance. Retail isn’t the only development sector that follows rooftops.

For each market and subsector, we include a graphical breakdown of the current state of the market, the outlook and other important information (see the Multifamily example below). This is in addition to pages of narrative, tables and charts, insightful quotes and other important information that fills this 200-plus page book.
 

Multifamily Capsule 

About Our Book

The 2013 Guide to the U.S. AEC Markets will examine these issues – and many more – in far greater depth. The soon-to-be-published comprehensive report will include a review of the sector-by-sector projections from the 2012 forecast, as well as:

  • Dozens of interviews with leaders and experts in the markets served by architects, engineers, environmental consultants and contractors.
  • Ten industry trends (and what they mean to you)
  • A recap of 2012 and the U.S. Economic Overview for 2013
  • A U.S. geographic outlook, regionally and state by state
  • Discussion of passed, pending and potential legislation that could affect the AEC industry in 2013
  • A look at the post-election AEC industry from both sides of the aisle
  • Most promising international markets and regions
  • The 2013 outlook for over 25 major markets and subsectors
  • Ranking of the hottest and coldest markets for 2013
  • More than 20 pages of links, articles and other resources for firms to consult and use in their own research

Buyers will also receive quarterly Updates of fresh market data and industry developments. These 20-plus-page reports will ensure that the 2013 Guide will prove its worth all year long. 

The list price for the pdf-only version of The 2013 Guide to the U.S. AEC Markets is $299, but right now, you can get the prepublication price of $225. (Hard copy price is $279 prepublication, $349 list.) As always, we offer a full refund guarantee; so there’s no risk to you.

To pre-order your copy of The 2013 Guide to the U.S. AEC Markets  – due out by October 5 – click on the button on the top right and pay with your major credit card.

Table of Contents for The 2013 Guide
to the U.S. AEC Markets (Working)

Part 1: Introduction: A Time Like We’ve Never Seen Before

Part 2: Ten Trends in the Industry

Part 3: The U.S. Economy: Is the Recovery Finally Here?

Part 4: Election 2012: What it Means to You

Part 5: The Geographic Markets in the U.S.

Part 6: The International Markets: Beyond BRIC

Part 7: U.S. Market Outlook for 2013

  • Introduction
    • Demographics
    • Methodology
  • Residential Outlook
    • Single Family
    • Multifamily/Senior Housing
  • Commercial Outlook
    • Office
    • Retail
    • Hospitality
    • Industrial/Warehouse
  • Manufacturing
  • Institutional
    • Health Care
    • Higher Ed
    • K-12
    • Science/Technology
    • Government Buildings
  • Transportation
    • Roads/Bridges
    • Aviation
    • Rail
    • Ports/Shipping
  • Water/Wastewater
    • Water Supply
    • Wastewater Treatment
    • Storm Water Management
  • Energy
    • Renewable
    • Non-Renewable
  • Environmental
    • Solid Waste
    • Hazardous Waste
    • Air Pollution
    • Testing & Analytical Services

Part 8: Best & Worst U.S. Markets for 2013

Appendix: Resources & Links

The 2013 Guide to the U.S. AEC Markets comes with a full money-back guarantee. Click on the button below to order.

If you have any questions, e-mail to [email protected].