If you missed our discussion about the Electronic Systems Outlook report, here are the construction trends shaping our industry right now.
Every six months, we bring you the latest revelations in construction and explain how they translate to our industry. Our Electronic Systems Outlook report explains where construction is headed (up or down), which markets are predicted to do well, and which technologies are being deployed as part of these projects.
Once the report is released, we discuss the most interesting findings in a webinar along with analysts from research firm FMI Corp.
If you missed our discussion about the report, here are the construction trends shaping our industry right now.
1. Class-A Commercial Construction Heats Up
As companies attempt to make returning to work as attractive and productive as possible, one market seeing lots of construction activity is Class-A office space. With these construction projects come smart rooms, AV technology, and building management systems—all chances for integrators to play a role.
Overall, the commercial office space is also seeing renovation and retrofit work taking place as some offices—especially Class-B and Class-C buildings—are being converted into Class-A facilities or even into multifamily housing to meet the rising demand for residential living spaces.
2. Data Center Growth Accelerates in Certain Areas
Certain regions of the United States are seeing action in terms of data center growth, whether it’s centered on hyperscale data centers, colocation facilities, or edge data centers. (Consider Northern Virginia, for example, which is the No. 1 data center market in the world.)
The trend not only points to new construction but also to updates for existing data centers to prepare them to support higher density and process more data.
Dan Schmidtendorff, NSCA board member and CEO at Communication Company, says his company is seeing such massive growth in data center projects that contractors are being brought in from out of town in an attempt to keep up. “There’s lots of opportunity in this industry,” he explains, “whether you’re talking about fire alarms, access control, or CCTV.”
Network and cabling infrastructure design and installation also offer big opportunities for integrators in the data center market.
3. Healthcare Investments Shift to a Hub-and-Spoke Model
According to Patrick Dennehy, senior analyst at FMI Corp., the emergence of COVID-19 spurred investments in hospital construction and expansion that haven’t let up.
Looking ahead, however, as healthcare costs grow, construction data suggests a move away from upfitting and renovating and a focus instead on what Dennehy calls the “hub-and-spoke model.” This is a model that healthcare systems follow to establish more local specialty facilities, outpatient care centers, urgent care clinics, and specialty buildings like dialysis centers.
“The goal with this work is to reduce the amount of time people spend in hospitals and reduce the costs of going to the doctor,” explains Dennehy. “As we look ahead, we expect more of those local offices to have a high investment share. Especially with an aging population, a lot of the construction activity will happen not necessarily at hospitals themselves but at the spokes around the hospital.”
The market’s shortage of doctors and nurses will also drive technology deployment so more patient care can happen in less time without sacrificing quality, says Schmidtendorff. “A surgery that might’ve taken two, three, or four days of recovery is now an outpatient procedure based on new technologies that exist.”
4. Higher Education Stages a Construction Comeback
Declining enrollment metrics are spurring colleges and universities to rethink how they attract and retain students.
As a result, the market is seeing an increase in projects that help these campuses position themselves as learning institutions and get students excited about attending and earning a degree.
“The most popular and in-demand subsegments are four-year public institutions, so that’s where most of the work is happening, right now” explains Dennehy. “Schools are competing through their science, technology, engineering, and math facilities. We’re seeing innovation centers going up and high levels of technology being added to classrooms.”
Trade schools are also seeing an injection of funds as they compete for students and prepare them for the opportunities that exist. This means upgrading classrooms, offering apartment-style living instead of dorm rooms, and other spaces that used to be reserved for traditional four-year college campuses.
5. K-12 Invests in Tech to Boost Teaching
Many factors—from suburbanization and declining student performance to the shift to online learning and teacher shortages—are driving the need to invest in K-12 construction, which is also on the rise.
These influences are driving changes to K-12 spaces, including:
- Smaller classrooms
- Flexible, multi-use, and diverse spaces
- Technology to support quality teaching
- Smart boards, flexible seating, and technology to keep students engaged
- Classrooms that support in-person and virtual instruction
“School security is also a hot topic as well,” explains Schmidtendorff. “Integrators are needed to support things like high-tech locks, cameras, and security systems.”
How to Use This Report
NSCA can help you use the information in this report to drive your strategic planning and sales and marketing initiatives.
If you have questions about how to evaluate where you are, what you’re well-positioned to accomplish, and where you need to move in the next few years, send us a note.
And if you want to hear us discuss these findings in more detail, along with the big-picture impact they’ll have, watch the entire webinar on-demand.
