Despite some weakness in July and August, construction spending during the first eight months of the year was up, driving M&A among a wide array of related subsectors, from hardwood to foam insulation. Dealmakers who invest in construction-related businesses said there’s still plenty of room for growth, expressing optimism about the future at the 2016 Building & Infrastructure Conference, hosted by Lincoln International and L.E.K. Consulting on Sept. 30 at the New York Athletic Club.
“While economic indicators demonstrate growth, we are still operating well below historical averages,” said conference organizers in a letter to attendees. “For instance, five years into the recovery, residential construction spending is currently 66 percent of prerecession levels. Multi-family activity has driven the recent residential construction growth, and single-family activity remains below its long-term average. The repair & remodel market continues to grow and is now above its previous cycle high. Nonresidential construction, which typically lags residential construction by 18 to 24 months, has shown signs of a recovery and remains below prerecession highs.”