Construction Volume Continues Upward.

SAN FRANCISCO--(BUSINESS WIRE)--Oct. 31, 1996--Developers, owners and contractors who were anticipating a continuance in the state's construction recovery were all smiles again with the report that California construction volume for September totalled $2.65 billion.

Seasonally adjusted, the September total, which measures permits and contract awards, is $31.8 billion, down 3.7 percent from August, but up 8.9 percent from September 1995.

According to statistical data compiled by the Construction Industry Research Board (CIRB) and analyzed by Lamberson Koster & Company, surety and insurance brokers, residential building was up from both August and the year-ago month while private nonresidential building was up from September 1995.

According to Ben Bartolotto, Director of the Research Board, these figures are a continuation of an upward recovery not only for the remainder of this year, but also covered in CIRB's forecast for 1997 and 1998. Adjusted for inflation and stated in 1996 dollars, Bartolotto is now forecasting total construction in 1996 to reach $31.83 billion, up 5.7 percent from 1995 and the highest construction volume total since 1991. Further, his forecast for 1997 has been increased to $36.05 billion, up 12.9 percent from 1996. And, for the first time this year, CIRB is projecting a $38.26 billion construction volume for 1998, which is a 6.1 percent increase over 1997.

The CIRB prognostications are based on anticipated gains in residential and nonresidential building for 1996 as well as in all three sectors (including heavy construction) in 1997 and 1998.

"We are seeing a steady response to job growth," said Bartolotto, "and, while heavy construction figures are lagging now, we expect a progression of growth over the next two years in heavy construction due to increased funding for seismic retrofit work as a result of the Proposition 192 bond measure."

Among other good news the Lamberson Koster analysts report:

-- New housing units in the first nine months total 71,512, up 11.1 percent from the same period last year. The 1996 forecast is 94,900 units, up 11.3 percent from 1995.

-- Private nonresidential building permit valuations total $822.8 million in September, down 6.9 percent from August but up 16.9 percent from September 1995. During the first nine months, nonresidential building total $7.16 billion, up 13.7 percent from the year-ago period.

-- Heavy construction contracts total $516.1 million in September, according to data from the "Local Construction Potentials" of Dodge Division of McGraw Hill. The two largest contracts in September are a $29.3 million wastewater reclamation expansion in Fresno County and a $23.1 million wastewater treatment plant expansion in Riverside County.

(For further information, call Ben Bartolotto at 818/841-8210.)

CONTACT: Lamberson Koster & Co.

Tom Willow, 916/974-7556