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K-12 Education Construction Surges Again

Mar 1, 2007 12:00 PM, By Stefanie Kure Senior Associate Editor

Electrical contractors take note: K-12 education construction is on the upswing for 2007 and is projected to remain strong for almost a decade — making education the nation's largest nonresidential building market based on the value of total construction. According to the National Center for Education Statistics (NCES), Washington, D.C., K-12 enrollments will grow by 3 million — or 5.4% — between 2005 and 2015, ultimately reaching a total of 58.1 million students. This surge in enrollments translates into billions of dollars spent on new and/or upgraded classroom space and demand for the companies who help provide it.

While overall U.S. enrollment growth remains strong, experts say certain regions of the country will reap more benefits than others. According to McGraw-Hill's “Construction Outlook 2007,” most of the growth will come from the South and West over the next 10 years. In the South, a notable 2.1 million (11.5%) more students will attend public school by 2015. Specifically, Texas, Florida, Georgia, and North Carolina will each experience enrollment gains of 10% or greater. The West will also see an expansion in enrollments, growing by 821,000 (6.9%) to a total of 12.7 million by 2015, with Nevada and Arizona leading the pack. Although expected to gain just 171,000 students over the next 10 years, California will remain the state with the largest number of students — anticipated to reach 6.6 million in 2015.

In comparison, the Northeast and Midwest are poised to lose students over the next decade. The majority of this decline will take place in the Northeast, with a loss of 343,000 students (4.2% decrease). States facing the biggest reductions in enrollments include New York (-184,000), Pennsylvania (-85,000), Michigan (-67,000), Ohio (-55,000), and Massachusetts (-30,000). A more moderate 30,000 student drop (less than 1%) is predicted for the Midwest.

Nevertheless, “the total numbers of school-age children still are staggering even when compared to total numbers in the South and West,” says Joe Agron, editor-in-chief of American School & University magazine, an Overland Park, Kan.-based trade magazine and sister publication of EC&M. “Even with overall enrollment declines, many areas of the Northeast and Midwest are growing.”

According to AS&U's “32^nd Annual Official Education Construction Report,” educational institutions (K-12 and higher education combined) will spend around $125 billion on construction projects between 2006 and 2008. For K-12, construction spending will total $80.1 billion, with $46.2 billion being spent on new facilities, $16.3 billion earmarked for additions, and $17.6 billion going toward modernizations. The Table (click here to see Table) details how K-12 construction dollars are projected to be split through 2008.

Although the majority of money is still being allocated to new construction, renovations and modernizations will likely become a larger part of K-12 education construction over the next few years, reports FMI Corp., a management consulting and investment banking firm headquartered in Raleigh, N.C. In its “2007 U.S. Markets Construction Overview,” FMI attributes this shift in spending to several factors: the mushrooming cost of materials and labor, infrastructure enhancements needed to address changing weather and climate conditions across the United States, burgeoning classroom technology requirements, and advanced building codes and materials standards.

Other trends FMI sees affecting K-12 construction include the upsurge in rural and urban school closings, increased immigration/emigration, and the gaining popularity of green design (also known as sustainable design or high-performance design), an approach that seeks to produce buildings in a way that reduces use of non-renewable resources, minimizes environmental impact, and relates people with the natural environment.

A recent study by McGraw-Hill Construction, “The Education Green Building SmartMarket Report,” finds that the education sector is the fastest-growing market for sustainable design. “The results are very exciting,” says Harvey M. Bernstein, McGraw-Hill Construction vice president of Industry Analytics, Alliances, and Strategic Incentives, New York. “Given the fact that education construction is worth $53 billion overall — and the market indicators point to strong green building growth in this sector — we expect the green building share to be significant in five years.”

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© 2012 Penton Business Media, Inc.

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