South Central

In the same way that construction in the Southwest region is dominated by California, construction in the South Central region is dominated by Texas.

Major companies that left Silicon Valley have relocated here, mainly to the area around Austin. Cities in the Texas Triangle have seen impressive growth as a result – office buildings here have high occupancy levels and new commercial spaces have sprung up to accommodate all the new residents. The most recent Texas state budget shows a 10% increase in spending relative to the last year – half of that increase is due to education spending, while another third is for improving the state’s healthcare system.

The Texas Triangle continues to be one of the country’s most active regions. This has been true for the last several years and we expect it to be true for years to come. The overall outlook has not changed significantly since our last report – the market has grown dramatically and while the cost of living remains manageable, the cost of building has increased considerably. Nominal construction spending has more than doubled over the last ten years, but the labor force has only grown by about 30%. More projects competing for fewer workers means that workers can demand higher wages. This, in turn, has pushed labor costs up considerably. We expect this to continue for years to come as well.

Outside of Texas, data centers are being built across the Deep South. These can be built anywhere with cheap land, plentiful electricity, and lots of water access – things that states like Louisiana and Mississippi have in spades. As commerce continues to move online, demand for these facilities has only accelerated. New projects are announced each week, making it difficult for contractors to keep up.

* Other structures include religious buildings, amusement, government communications, and public recreation projects.
Source: BuildCentral

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