Detroit - For the Detroit area's construction forecast, we turn to David B. Hanson, president of the Associated General Contractors, Greater Detroit Chapter. The Walbridge-Aldinger executive vice president spoke at the Dec. 11, 2000 Outlook luncheon at the Detroit Economic Club, starting with a little bit of history on the building market.

He said construction activity hit a peak in 1987, then slid for the next four years to "historic lows" in 1991. "The market came back with a slight uptick in 1992," Hanson said, surpassed the 1987 peak in 1996 and today activity is nearly 20 percent above that 1987 high point. Our industry is experiencing one of the best runs ever."

Citing The Engineering News Record, Hanson said in constant dollars, the volume of the nation's construction activity in 2000 will be nearly 40 percent more than in 1991. "I will start off with the good news," Hanson said, "by predicting that that trend will continue in 2001 in both the nation and in the greater Detroit region and the amount of construction put in place will continue to grow, albeit slightly." He said for the majority of southeast Michigan contractors, there are work backlogs "at record or near-record levels."

He said that while new orders for construction may creep up 1 percent nationally, there may be a slight decrease in orders in Southeast Michigan in 2001. But, "a flat year for new construction sales does not mean that construction is drying up," he said, pointing to work about to begin on the Compuware headquarters, continuing work at the GM Renaissance Center, the Midfield Terminal, and school projects for the City of Detroit.

Other major ongoing projects include work at the GM Vehicle Test Facilities in Milford, the GM Tech Center in Warren, and the Daimler-Chrysler headquarters in Auburn Hills.

"The specter of softening auto sales casts some doubt as to the near-term future of many other projects currently in the planning stages in our area," Hanson said. "The continuing uncertainty on how hard the soft landing will be places uncertainty on third and fourth quarter new orders and therefore the direction of the industry in 2002. However, I remain optimistic that we are hitting a bump in the road rather than falling off the cliff."