We’ve gotten two interesting forecasts this week in California.
First, commercial construction in California has bounced back to its 2001 levels—the best it’s been in 14 years—according to a major study just released by UCLA’s school of management in conjunction with an LA-based law firm.
In the most recent UCLA-Allen Matkins survey, 40% of contractors said they had a new project on the books for the next 12 months, compared to 23% for the previous 12 months.
The survey showed that the forecast is also good for multi-family housing and industrial real estate construction.
The other big piece of news harks back to another year in California some 18 years ago: 1997. That was the year of a record-breaking El Niño that dumped twice the normal rainfall on Southern California. Weather forecasters say that we may have a bigger rainier season than that winter, due to an even stronger El Niño storm possibly brewing in the Pacific Ocean.
According to an LA Times article quoting the National Weather Service, conditions in the ocean as well as diminishing “trade winds” off the coast of Peru are ideal for a gigantic El Niño starting in late fall or early winter 2015 and maybe continuing into the spring of 2016.
So basically there will be a lot of new building construction in the next 12 months—if it doesn’t all get washed away! (But then, if everything gets washed away there’ll be a massive need for new construction.)