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Big Construction or a Lot of Construction?

by Freedonia Industry Studies

January 25, 2023

One of the trends appearing in many areas of building design is smaller buildings, but more of them.

For instance, quick service and fast food restaurants are opening smaller footprint stores, eliminating dine-in space in favor of concentrating on carryout and delivery business. Increasingly, even foodservice providers such as Starbucks are initiating a larger number of mini locations for convenient pickups of app-based, online orders.

Similarly, many retailers are developing smaller stores for greater shopping convenience. The ideas is that shoppers will be able to more easily access stores nearby but also get through their shopping faster rather than wandering through so many aisles. Smaller retail options are also better fits for urban areas, where space is often quite expensive.

Additionally, more companies are eliminating large centrally located headquarters offices in favor of smaller regional offices close to where employees live. This is a nod not only to worker preferences (a few years of work-from-home have led many workers to seek shorter commutes when required to go to the office), but also a cost-saving move compared to building, renting, and/or maintaining large office campuses in prime urban real estate markets.

All these changes mark a change from the previous prevailing construction trends, which called for ever larger homes, mega warehouse retailers, and flashy headquarters offices. As employment trends have begun to stabilize after the pandemic, many see the benefits of work done in more locations but in smaller sizes. Freedonia analysts will continue to watch this trend to see what it does in terms of construction material requirements and worker availability.

For more information and discussion of opportunities, see The Freedonia Group’s extensive collection of off-the-shelf research from our Construction and Building Products Group.   Freedonia Custom Research is also available for questions requiring tailored market intelligence.

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