US Commercial Construction Market

The US Commercial Construction Market, worth USD 1.8 trillion, grows via IIJA funding, urban demand, and sustainable tech, focusing on key cities like New York and Los Angeles.

Region:North America

Author(s):Rebecca

Product Code:KRAA2844

Pages:99

Published On:August 2025

About the Report

Base Year 2024

US Commercial Construction Market Overview

  • The US Commercial Construction Market is valued at USD 1.8 trillion, based on a five-year historical analysis of non-residential and engineering construction activity. This growth is primarily driven by increasing demand for office buildings, retail establishments, healthcare facilities, and data centers, alongside significant investments in infrastructure and urban development. The market has seen a resurgence post-pandemic, with a pronounced focus on sustainable building practices, digital technologies such as Building Information Modeling (BIM), artificial intelligence, and smart construction solutions, which are reshaping the construction landscape.
  • Key cities such asNew York, Los Angeles, and Chicagocontinue to dominate the US Commercial Construction Market due to robust economic activities, high population density, and ongoing urbanization. These metropolitan areas serve as major hubs for finance, technology, and healthcare, driving continuous demand for commercial spaces. Additionally, government initiatives and private investments in infrastructure, including large-scale projects in transportation and energy, further bolster their market presence.
  • In 2021, the US government enacted theInfrastructure Investment and Jobs Act (IIJA), allocatingUSD 1.2 trillionto enhance the nation’s infrastructure. This legislation, administered by the US Department of Transportation, aims to improve transportation, broadband, and energy systems, significantly impacting the commercial construction sector by increasing project funding and creating job opportunities, thereby stimulating economic growth.
US Commercial Construction Market Size

US Commercial Construction Market Segmentation

By Type:The commercial construction market is segmented into office buildings, retail spaces, hospitality, healthcare facilities, educational institutions, industrial facilities, mixed-use developments, and public safety buildings. Each segment addresses specific market demands, with data centers and healthcare facilities experiencing notable growth due to digital transformation and demographic shifts. Industrial facilities, particularly warehousing, have seen increased activity driven by e-commerce, while mixed-use developments reflect evolving urban planning trends.

US Commercial Construction Market segmentation by Type.

By End-User:The end-user segmentation includes private sector, public sector, and non-profit organizations. Private sector demand is led by commercial real estate developers and corporations, while public sector projects are driven by federal, state, and municipal investments in infrastructure and civic facilities. Non-profit organizations focus on educational, healthcare, and community-oriented developments, each segment influencing project types and funding sources.

US Commercial Construction Market segmentation by End-User.

US Commercial Construction Market Competitive Landscape

The US Commercial Construction Market is characterized by a dynamic mix of regional and international players. Leading participants such as Turner Construction Company, Bechtel Corporation, Skanska USA, Kiewit Corporation, The Whiting-Turner Contracting Company, Jacobs Engineering Group Inc., Clark Construction Group, LLC, PCL Construction Enterprises, Inc., Hensel Phelps Construction Co., Gilbane Building Company, Mortenson Construction, McCarthy Building Companies, Inc., DPR Construction, Balfour Beatty US, Structure Tone contribute to innovation, geographic expansion, and service delivery in this space.

Turner Construction Company

1902

New York, NY

Bechtel Corporation

1898

San Francisco, CA

Skanska USA

1971

New York, NY

Kiewit Corporation

1884

Omaha, NE

The Whiting-Turner Contracting Company

1909

Baltimore, MD

Company

Establishment Year

Headquarters

Group Size (Large, Medium, or Small as per industry convention)

Annual Revenue (USD)

Revenue Growth Rate (%)

Number of Projects Completed (Annual)

Average Project Value (USD)

Backlog Value (USD)

US Commercial Construction Market Industry Analysis

Growth Drivers

  • Increased Infrastructure Spending:The US government allocated approximately $1.2 trillion for infrastructure improvements under the Infrastructure Investment and Jobs Act. This funding is expected to enhance roads, bridges, and public transit systems, directly impacting commercial construction. In future, infrastructure spending is projected to reach $200 billion, stimulating demand for construction services and materials, thereby driving growth in the commercial construction sector significantly.
  • Urbanization Trends:In future, urban areas in the US are expected to house over 82% of the population, leading to increased demand for commercial spaces such as offices, retail, and mixed-use developments. The urban population is projected to grow by approximately 1 million annually, necessitating new construction projects. This trend is driving developers to invest in urban commercial properties, thereby fueling growth in the construction market.
  • Technological Advancements in Construction:The adoption of advanced technologies, such as Building Information Modeling (BIM) and prefabrication, is revolutionizing the construction process. In future, the market for construction technology is expected to exceed $1.5 billion, enhancing efficiency and reducing project timelines. These innovations are attracting investments and improving project delivery, thus acting as a significant growth driver in the commercial construction sector.

Market Challenges

  • Labor Shortages:The US construction industry faces a significant labor shortage, with an estimated 300,000 to 400,000 positions unfilled in future. This shortage is exacerbated by an aging workforce and insufficient training programs for new workers. As a result, project delays and increased labor costs are becoming common, posing a substantial challenge to the growth of the commercial construction market.
  • Rising Material Costs:In future, construction material costs are projected to increase by between 5% and 10% due to supply chain disruptions and inflationary pressures. Key materials such as steel and lumber have seen price hikes of over 30% in recent years. These rising costs are squeezing profit margins for construction firms and may lead to project cancellations or delays, presenting a significant challenge to the industry.

US Commercial Construction Market Future Outlook

The US commercial construction market is poised for growth, driven by increased infrastructure spending and urbanization trends. As cities expand, the demand for innovative construction solutions will rise, particularly in sustainable and smart building technologies. Additionally, the integration of digital tools will enhance project efficiency. However, challenges such as labor shortages and rising material costs will require strategic management. Overall, the market is expected to adapt and evolve, presenting new opportunities for stakeholders in the coming years.

Market Opportunities

  • Green Building Initiatives:The demand for sustainable construction practices is increasing, with the green building market projected to reach approximately $100 billion in future. This shift towards eco-friendly materials and energy-efficient designs presents significant opportunities for construction firms to differentiate themselves and attract environmentally conscious clients.
  • Smart Building Technologies:The market for smart building technologies is expected to grow to approximately $50 billion in future. This includes automation systems that enhance energy efficiency and occupant comfort. Construction firms that invest in these technologies can capitalize on the growing trend of smart cities, positioning themselves as leaders in the evolving commercial construction landscape.

Scope of the Report

SegmentSub-Segments
By Type

Office Buildings

Retail Spaces

Hospitality (Hotels & Lodging)

Healthcare Facilities

Educational Institutions

Industrial Facilities (Manufacturing & Warehousing)

Mixed-Use Developments

Public Safety & Government Buildings

By End-User

Private Sector

Public Sector

Non-Profit Organizations

By Application

New Construction

Renovation

Maintenance

By Investment Source

Private Investment

Government Funding

Foreign Direct Investment

By Project Size

Small Projects (Under $10M)

Medium Projects ($10M–$100M)

Large Projects (Over $100M)

By Construction Method

Traditional (Design-Bid-Build)

Design-Build

Construction Management at Risk (CMAR)

Integrated Project Delivery (IPD)

By Policy Support

Tax Incentives

Grants

Subsidies

Key Target Audience

Investors and Venture Capitalist Firms

Government and Regulatory Bodies (e.g., U.S. Department of Housing and Urban Development, Occupational Safety and Health Administration)

Construction Project Owners

Architectural and Engineering Firms

Real Estate Developers

Material Suppliers and Manufacturers

Construction Equipment Rental Companies

Insurance Providers and Underwriters

Players Mentioned in the Report:

Turner Construction Company

Bechtel Corporation

Skanska USA

Kiewit Corporation

The Whiting-Turner Contracting Company

Jacobs Engineering Group Inc.

Clark Construction Group, LLC

PCL Construction Enterprises, Inc.

Hensel Phelps Construction Co.

Gilbane Building Company

Mortenson Construction

McCarthy Building Companies, Inc.

DPR Construction

Balfour Beatty US

Structure Tone

Table of Contents

Market Assessment Phase

1. Executive Summary and Approach


2. US Commercial Construction Market Overview

2.1 Key Insights and Strategic Recommendations

2.2 US Commercial Construction Market Overview

2.3 Definition and Scope

2.4 Evolution of Market Ecosystem

2.5 Timeline of Key Regulatory Milestones

2.6 Value Chain & Stakeholder Mapping

2.7 Business Cycle Analysis

2.8 Policy & Incentive Landscape


3. US Commercial Construction Market Analysis

3.1 Growth Drivers

3.1.1 Increased Infrastructure Spending
3.1.2 Urbanization Trends
3.1.3 Technological Advancements in Construction
3.1.4 Demand for Sustainable Building Practices

3.2 Market Challenges

3.2.1 Labor Shortages
3.2.2 Rising Material Costs
3.2.3 Regulatory Compliance Issues
3.2.4 Economic Uncertainty

3.3 Market Opportunities

3.3.1 Green Building Initiatives
3.3.2 Smart Building Technologies
3.3.3 Public-Private Partnerships
3.3.4 Expansion into Emerging Markets

3.4 Market Trends

3.4.1 Modular Construction
3.4.2 Digital Twin Technology
3.4.3 Increased Focus on Safety Standards
3.4.4 Use of Drones in Construction

3.5 Government Regulation

3.5.1 Building Codes and Standards
3.5.2 Environmental Regulations
3.5.3 Labor Laws
3.5.4 Zoning Laws

4. SWOT Analysis


5. Stakeholder Analysis


6. Porter's Five Forces Analysis


7. US Commercial Construction Market Market Size, 2019-2024

7.1 By Value

7.2 By Volume

7.3 By Average Selling Price


8. US Commercial Construction Market Segmentation

8.1 By Type

8.1.1 Office Buildings
8.1.2 Retail Spaces
8.1.3 Hospitality (Hotels & Lodging)
8.1.4 Healthcare Facilities
8.1.5 Educational Institutions
8.1.6 Industrial Facilities (Manufacturing & Warehousing)
8.1.7 Mixed-Use Developments
8.1.8 Public Safety & Government Buildings

8.2 By End-User

8.2.1 Private Sector
8.2.2 Public Sector
8.2.3 Non-Profit Organizations

8.3 By Application

8.3.1 New Construction
8.3.2 Renovation
8.3.3 Maintenance

8.4 By Investment Source

8.4.1 Private Investment
8.4.2 Government Funding
8.4.3 Foreign Direct Investment

8.5 By Project Size

8.5.1 Small Projects (Under $10M)
8.5.2 Medium Projects ($10M–$100M)
8.5.3 Large Projects (Over $100M)

8.6 By Construction Method

8.6.1 Traditional (Design-Bid-Build)
8.6.2 Design-Build
8.6.3 Construction Management at Risk (CMAR)
8.6.4 Integrated Project Delivery (IPD)

8.7 By Policy Support

8.7.1 Tax Incentives
8.7.2 Grants
8.7.3 Subsidies

9. US Commercial Construction Market Competitive Analysis

9.1 Market Share of Key Players

9.2 Cross Comparison of Key Players

9.2.1 Company Name
9.2.2 Group Size (Large, Medium, or Small as per industry convention)
9.2.3 Annual Revenue (USD)
9.2.4 Revenue Growth Rate (%)
9.2.5 Number of Projects Completed (Annual)
9.2.6 Average Project Value (USD)
9.2.7 Backlog Value (USD)
9.2.8 Market Penetration Rate (%)
9.2.9 Customer Satisfaction Index
9.2.10 Safety Incident Rate (per 100 FTEs)
9.2.11 Employee Turnover Rate (%)
9.2.12 LEED-Certified Projects (%)
9.2.13 Digital Adoption Index
9.2.14 EBITDA Margin (%)
9.2.15 Innovation Index

9.3 SWOT Analysis of Top Players

9.4 Pricing Analysis

9.5 Detailed Profile of Major Companies

9.5.1 Turner Construction Company
9.5.2 Bechtel Corporation
9.5.3 Skanska USA
9.5.4 Kiewit Corporation
9.5.5 The Whiting-Turner Contracting Company
9.5.6 Jacobs Engineering Group Inc.
9.5.7 Clark Construction Group, LLC
9.5.8 PCL Construction Enterprises, Inc.
9.5.9 Hensel Phelps Construction Co.
9.5.10 Gilbane Building Company
9.5.11 Mortenson Construction
9.5.12 McCarthy Building Companies, Inc.
9.5.13 DPR Construction
9.5.14 Balfour Beatty US
9.5.15 Structure Tone

10. US Commercial Construction Market End-User Analysis

10.1 Procurement Behavior of Key Ministries

10.1.1 Federal Government
10.1.2 State Governments
10.1.3 Local Governments

10.2 Corporate Spend on Infrastructure & Energy

10.2.1 Corporate Investments
10.2.2 Budget Allocations
10.2.3 Infrastructure Priorities

10.3 Pain Point Analysis by End-User Category

10.3.1 Cost Overruns
10.3.2 Delays in Project Timelines
10.3.3 Quality Assurance Issues

10.4 User Readiness for Adoption

10.4.1 Technology Adoption Rates
10.4.2 Training and Skill Development

10.5 Post-Deployment ROI and Use Case Expansion

10.5.1 Performance Metrics
10.5.2 Long-term Benefits

11. US Commercial Construction Market Future Size, 2025-2030

11.1 By Value

11.2 By Volume

11.3 By Average Selling Price


Go-To-Market Strategy Phase

1. Whitespace Analysis + Business Model Canvas

1.1 Market Gaps Identification

1.2 Business Model Framework


2. Marketing and Positioning Recommendations

2.1 Branding Strategies

2.2 Product USPs


3. Distribution Plan

3.1 Urban Retail Strategies

3.2 Rural NGO Tie-ups


4. Channel & Pricing Gaps

4.1 Underserved Routes

4.2 Pricing Bands


5. Unmet Demand & Latent Needs

5.1 Category Gaps

5.2 Consumer Segments


6. Customer Relationship

6.1 Loyalty Programs

6.2 After-sales Service


7. Value Proposition

7.1 Sustainability Initiatives

7.2 Integrated Supply Chains


8. Key Activities

8.1 Regulatory Compliance

8.2 Branding Efforts

8.3 Distribution Setup


9. Entry Strategy Evaluation

9.1 Domestic Market Entry Strategy

9.1.1 Product Mix
9.1.2 Pricing Band
9.1.3 Packaging

9.2 Export Entry Strategy

9.2.1 Target Countries
9.2.2 Compliance Roadmap

10. Entry Mode Assessment

10.1 Joint Ventures

10.2 Greenfield Investments

10.3 Mergers & Acquisitions

10.4 Distributor Model


11. Capital and Timeline Estimation

11.1 Capital Requirements

11.2 Timelines


12. Control vs Risk Trade-Off

12.1 Ownership vs Partnerships


13. Profitability Outlook

13.1 Breakeven Analysis

13.2 Long-term Sustainability


14. Potential Partner List

14.1 Distributors

14.2 Joint Ventures

14.3 Acquisition Targets


15. Execution Roadmap

15.1 Phased Plan for Market Entry

15.1.1 Market Setup
15.1.2 Market Entry
15.1.3 Growth Acceleration
15.1.4 Scale & Stabilize

15.2 Key Activities and Milestones

15.2.1 Milestone Planning
15.2.2 Activity Tracking

Research Methodology

ApproachModellingSample

Phase 1: Approach1

Desk Research

  • Analysis of industry reports from the American Institute of Architects (AIA) and the Associated General Contractors of America (AGC)
  • Review of government publications, including the U.S. Census Bureau's construction spending data
  • Examination of market trends and forecasts from construction trade journals and economic outlook reports

Primary Research

  • Interviews with project managers and executives from leading construction firms
  • Surveys targeting architects and engineers involved in commercial projects
  • Field interviews with contractors and subcontractors on-site to gather insights on operational challenges

Validation & Triangulation

  • Cross-validation of findings through multiple data sources, including financial reports and industry publications
  • Triangulation of qualitative insights from interviews with quantitative data from surveys
  • Sanity checks conducted through expert panel reviews comprising industry veterans

Phase 2: Market Size Estimation1

Top-down Assessment

  • Estimation of total market size based on national construction expenditure data
  • Segmentation of the market by commercial sectors such as retail, office, and hospitality
  • Incorporation of macroeconomic indicators such as GDP growth and urbanization rates

Bottom-up Modeling

  • Collection of project-level data from major construction projects across the U.S.
  • Estimation of average project costs based on historical data and current market rates
  • Volume calculations based on the number of projects initiated and completed annually

Forecasting & Scenario Analysis

  • Multi-factor regression analysis incorporating variables such as interest rates, labor costs, and material prices
  • Scenario modeling based on potential changes in government infrastructure spending and policy shifts
  • Development of baseline, optimistic, and pessimistic forecasts through 2030

Phase 3: CATI Sample Composition1

Scope Item/SegmentSample SizeTarget Respondent Profiles
Commercial Office Construction100Project Managers, Architects
Retail Space Development80Construction Executives, Real Estate Developers
Hospitality Sector Projects60General Contractors, Hotel Development Managers
Industrial Facility Construction50Operations Managers, Facility Planners
Public Infrastructure Projects70Government Officials, Civil Engineers

Frequently Asked Questions

What is the current value of the US Commercial Construction Market?

The US Commercial Construction Market is valued at approximately USD 1.8 trillion, reflecting a comprehensive analysis of non-residential and engineering construction activities over the past five years. This valuation highlights the sector's significant growth and ongoing demand for various commercial spaces.

What are the main drivers of growth in the US Commercial Construction Market?

Which cities are leading in the US Commercial Construction Market?

How has the Infrastructure Investment and Jobs Act impacted the construction sector?

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