Office Sector Report: After a six-year slide, the office market is back in business
Jim Haughey, Director, Research and Analytics, Reed Construction Data -- Building Design & Construction, 7/1/2007 12:00:00 AM
The office market began to grow rapidly late last year after declining since 2000. The turnabout was driven by the strengthening economy, which reduced office vacancy rates and pushed rent increases up to a 6% per year pace.
The office-based finance, insurance, real estate, professional, and technical services industries are adding employees twice as fast as the rest of the economy. This is a typical occurrence at the mature end of a business expansion.
Jobsite construction spending is expected to increase 20% in 2007 and 12% in 2008. The year-to-date value of office starts through May is 45% above the same five months last year, according to Reed Construction Data.
The value of office starts will increase 20% for all of 2007 and then expand enough to keep up with rising project costs for several more years.
Top 20 office design firms
(2006 billings in $ millions)
| Firm | Billings |
| Source: 2007 Giants 300 survey Note: This ranking is based on firms that made the Giants 300 list. |
|
| 1. Carter & Burgess | 54.59 |
| 2. HOK | 49.52 |
| 3. Gensler | 42.10 |
| 4. Thornton Tomasetti | 39.84 |
| 5. Perkins+Will | 38.25 |
| 6. SmithGroup | 35.59 |
| 7. Kohn Pedersen Fox Associates | 34.32 |
| 8. Syska Hennessy Group | 29.24 |
| 9. Parsons Brinckerhoff | 25.06 |
| 10. NBBJ | 22.46 |
| 11. Stantec | 21.32 |
| 12. Smallwood, Reynolds, Stewart, Stewart | 19.68 |
| 13. HDR Architecture | 17.31 |
| 14. Burt Hill | 16.47 |
| 15. HKS | 16.17 |
| 16. KlingStubbins | 15.60 |
| 17. Environmental Systems Design | 14.95 |
| 18. RTKL Associates | 14.46 |
| 19. Corgan Associates | 12.30 |
| 20. Schirmer Engineering Corp. | 12.26 |
Top 20 office contractors
(2006 revenue in $ millions)
| Firm | Revenue |
| Source: 2007 Giants 300 survey Note: This ranking is based on firms that made the Giants 300 list. |
|
| 1. The Turner Corp. | 2,233.98 |
| 2. Structure Tone | 1,431.00 |
| 3. Clark Group | 649.80 |
| 4. JE Dunn Construction Group | 461.16 |
| 5. The Opus Group | 459.00 |
| 6. Duke Construction | 382.00 |
| 7. James G. Davis Construction | 350.86 |
| 8. The Whiting-Turner Contracting Co. | 319.90 |
| 9. Gilbane Building Co. | 282.49 |
| 10. Hoffman Construction | 279.99 |
| 11. McGough Construction | 275.94 |
| 12. Bovis Lend Lease | 231.95 |
| 13. Austin Commercial | 231.44 |
| 14. Swinerton Inc. | 222.43 |
| 15. Skanska USA Building | 190.00 |
| 16. M. A. Mortenson Co. | 168.76 |
| 17. Balfour Beatty Construction | 168.70 |
| 18. The Weitz Co. | 163.90 |
| 19. DPR Construction | 157.81 |
| 20. PCL Construction Enterprises | 154.86 |
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