The U.S. economy has recently been positively affected by commercial real estate. According to a recent report by the NAIOP Research Foundation, commercial real estate has helped to strengthen the economy by a whopping $935 billion, while also upholding 7.6 million U.S. jobs.
The report, titled “Economic Impacts of Commercial Real Estate,” was written by Stephen S. Fuller, Ph.D., the director of the Stephen J. Fuller Institute at George Mason University in Arlington, Va.
It indicated that construction began on close to 524 million square feet of commercial buildings last year. The recent growth seen in commercial real estate got a solid push from the construction sector.
The complete economic output of the four building types encompassed in the report – office, industrial, warehouse and retail – totaled $98.6 billion – which is an 18.9% increase from 2016, totaling $15.6 billion. The breakdown in expenditures by commercial construction type for 2017 is as follows:
- Office Construction – $36.5 billion in expenditures, down by 0.4% from 2016
- Retail Construction – $17.1 billion, down from 0.8% from 2016
- Warehouse Construction – $21.1 billion, up 55.7% from 2016
- Industrial Construction – $23.9 billion, up 52.5% from 2016
Existing Commercial Real Estate Has Impact Too
During 2017, existing building operations totaled approximately $155.2 billion and added $394.1 billion to the U.S. GDP. With this contribution to the U.S. economy came the generation of $112.9 billion in wages and salaries and support of four million jobs.
Commercial Real Estate Boom Boosts Employment
Between the years of 2006 to 2010. construction employment steadily declined by 2.3 million jobs. New jobs began to be added to this industry in the early part of 2011, according to the Bureau of Labor Statistics. Employment in this industry increased in 2017 for the seventh straight year. From November 2016 to 2017, construction employment added 184,000 new jobs, a 2.7% increase compared to a 1.5% total job growth during this same time frame.
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