Blueprint for a Building Boom

Momentum and opportunity are building in the North American construction sector. There were 504 megaprojects, each valued at $1 billion or more, announced from January 2021 through the start of Q4 2024, according to power management company Eaton Corp.

That’s $1.6 trillion of megaprojects, and just 16% of them have started construction—promising years of future revenues for the companies that build them.

“There have never been so many infrastructure projects and so many different types of projects funded at one time,” says Ken Simonson, Chief Economist at the Associated General Contractors of America. He believes the surge represents a once-in-a-generation opportunity.

Four main trends are driving the construction industry’s growth: infrastructure modernization; the booming digital economy; reshoring supply chains; and building resilient communities and cities.

One in every five miles of US highways and major roads needs repair, while 42% of the country’s bridge stock is at least 50 years old, according to the 2021 Report Card for America’s Infrastructure.

The economic gains that will be realized by addressing these infrastructure needs are enormous:

$33B

The US economy stands to recoup $33 billion in losses due to flight delays at outdated airports.

 Source: Federal Aviation Administration, 2019 study

$87B

Could flow back into the US economy from traffic congestion reduction through properly maintained roads.

Source: Infix

$1.50

Annual private economic activity generated by each public dollar invested in infrastructure.

Source: World Bank

The United States will continue to rank as the biggest builder of data centers, says Simonson. “The data center market will continue to grow, and it’s also going to show up in a lot more places” as Virginia reaches a saturation point, he says. The construction market for the sector is projected to almost double by 2029, reaching more than $47 billion annually, according to McKinsey & Co.

The rise of artificial intelligence and its need for massive computing power has given birth to hyperscale data centers.

In January, on his second day in office, President Donald Trump announced a $100 billion joint venture named Stargate to privately fund artificial intelligence infrastructure. The joint venture has a goal of increasing investment to $500 billion to build new infrastructure, including data centers and physical campuses.

That followed an earlier January announcement by Trump that by an Emirati company led by billionaire Hussain Sajwani would invest $20 billion in data centers in the United States.

It’s not uncommon for large data centers to comprise 100,000 square feet—a little less than two American football fields—and the largest of the hyperscale centers have square footage in the millions.

Source: Institute of Electrical and Electronics Engineers

Data centers can accommodate tens of thousands of servers.

Each rack in a hyperscale data center can use as much power each day as three to six American homes.

Source: Data Center Dynamics

But servers only account for about a quarter of a data center’s total energy needs. Nearly half of its energy goes toward cooling the computers. To manage temperatures, some centers deploy high-performance roofing insulation, allowing the facility to maintain cooler temps with lower operational costs.

Sources: McKinsey, Holcim

“How do you make that a win-win?” asks Jonathan Bluey, Assistant Professor of Practice in the Building Construction Department at Virginia Tech University, regarding the heat generated by data centers. “To me, the big question is how do you take that heat and heat buildings or homes?” Bluey, who closely observes data center construction, cites ongoing research by the National Renewable Energy Laboratory as pointing the way forward.

US investment in manufacturing has more than tripled in recent years, with more manufacturing facilities being constructed than any other kind of facility, according to the Alliance for American Manufacturing.

That boom arrives on the tailwind of federal incentives that aim to move manufacturing facilities back to the US after years of offshoring. More than 90% of North American manufacturers have relocated at least some of their production or supply chain in the last five years.

Modular construction is another area of convergence between the growth driver of data centers and the manufacturing sector, says Bluey. The massive builds of data centers are increasingly begun in factories that prefabricate sections and ship them to the build site.

“From a building science standpoint, they’re getting more and more novel with how they’re modularizing and then shipping sections already assembled,” Bluey says.

For cities, investment in infrastructure almost always equals investment in climate preparedness, says Josh Radoff, Renewable and Sustainable Energy Specialization Lead in the University of Colorado, Boulder, Masters of the Environment program. “Any place that’s doing infrastructure planning, it’s rare that they’re not also doing resilience planning,” he says.

Eighty percent of the US population lives in cities, according to Climate Central, which found that the urban heat island effect makes a number of large cities, which together house 41 million Americans, at least 8°F warmer than surrounding rural areas.

Mitigating rising temperatures is just one climate challenge being met by construction innovation. The $47 billion earmarked by the Infrastructure Investment and Jobs Act to help communities prepare for or recover from extreme weather will support infrastructure solutions like these:

GREEN ROOFING

US demand for green roofs—which are proven to naturally cool interiors and divert rainwater from flood zones, while reducing the size, cost and maintenance of stormwater infrastructure and detention—is projected to reach $207 Million in 2025.

Sources: US Green Roofing Market 2022–2030; EPA: Stormwater Best Practices

REFLECTIVE EXTERIORS

On building exteriors, reflective surfaces are used to manage internal temperatures and mitigate the urban heat island effect. Reflective white roofs installed in New York and Los Angeles have proven effective in lowering surrounding temperatures. University of Maryland researchers have developed a microporous coating that, when applied to a building’s surface, reduces dependence on air conditioning.

Sources: American Society of Mechanical Engineers; Yale School of the Environment

PERMEABLE CONCRETE

According to the London School of Economics, floods can reduce a city’s economic activity by up to 8% the year after the flood. One solution that cities are deploying is permeable concrete on roadways, sidewalks, parking lots and plazas, allowing stormwater to infiltrate the pavement’s surface, where it can help green cities by hydrating tree roots, rather than collecting and impeding mobility.

Sources: London School of Economics, National Association of City Transportation Officials

The circular nature of all these growth drivers—from infrastructure to the digital economy, from reshoring supply chains to building resilient communities—makes Simonson optimistic about 2025 construction starts.

The Gordie Howe International Bridge, which crosses the Detroit River and connects to Windsor, Ontario, is an example of a major infrastructure project spurring local economic growth. When completed in late 2025, the 1.5-mile span will be the longest cable-stayed bridge in North America, and more than 40,000 people and $323 million worth of trade are expected to cross it every day.

At 13 stories and with 265 guest rooms, the Populus Hotel is a reflection of Colorado’s native aspens, with fiberglass-reinforced concrete panels in shades of bark, and fenestration in the shape of trunk markings left by shed branches. This nature-inspired design ethos is matched by an emphasis on sustainable materials, including upcycled materials like salvaged fencing, and repurposed leather veneers used in ceilings and tabletops.

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