What Does April’s Drop in Multifamily Starts Mean for Glazing Industry?
Posted On May 19, 2020
The April U.S. Census data for new residential construction are out, and both single-family and multifamily housing starts took a COVID-19-driven hit.
Multifamily starts (buildings with five or more units) in particular saw a 39% decline in starts for the month on a seasonally adjusted annualized basis compared to the same time a year ago. They were also down by 40% in April compared to March, marking the third consecutive monthly decline for 5+unit multifamily building starts after a strong January.
So what does this mean for the glass and glazing industry? Well, heading into 2020, our Glass and Glazing Industry Outlook research suggested contract glaziers were still relatively bullish on the multifamily market. In fact, 38% of industry firms anticipated an increase in this type of activity in 2020 compared to 2019, while 50% expected no change and just 12% predicted a decrease.
We knew multifamily starts have been flattening out in recent years, but in terms of actual current activity among glazing contractors and backlog, multifamily remained a strong segment. With that said, these recent residential construction starts figures signal a coming decline in multifamily segment backlog for the glazing industry, so this is definitely something to take note of. Delays and cancellations are inevitable.
But since our industry seems to remain busy in multifamily work on current and near-future projects, and coupled with the fact that the overall economy is expected to recover from this as the year progresses, the hope is that the architectural glass and glazing industry feels less of a sting than these eye-popping one-month construction starts numbers suggest.
–Nick St. Denis