Real Estate & Construction

Real estate has regained momentum as the global economy recovers

The need for private capital to be invested in real estate and infrastructure has vastly increased in the world in recent years. The shift of population toward big cities and population growth particularly in developing economies boosts the demand for house construction in cities. Cities in advanced economies do not grow at an equal rate and demographic structure, technology and environmental problems are considered as value-creating factors in such economies.

The growth of the construction sector, which is affected most by global economic crises, is regaining momentum with the recovery of the global economy. The sector, which corresponds to 11 percent of the Gross World Product (GWP) and directly affects economies, plays a leading role in the re-achievement of growth and the world’s recovery from crises. According to AGS GLOBAL report, it is estimated that the global construction sector will grow faster than GWP over the next decade. Because of the construction sector’s ties to a great number of sectors, it is directly affected by crises that are experienced in other sectors and the general economy.

It is estimated that the annual growth rate of the construction sector of the Middle East and North Africa (MENA) region, which is a traditional market for Turkey’s international technical consultancy and contracting sectors, will be realized at 5.2 percent. Also, it is estimated that $4.3 trillion will be invested in the construction sector of the MENA market over the next decade.  The size of the Chinese construction sector will double and reach $2.5 trillion over the next decade. Thus, it is expected to top the global construction sector with a 21 percent share in it.

67%

Real Estate & Construction

Balanced growth.

Commercial building will increase 15%, slightly faster than the 14% gain estimated for 2016 while institutional building will advance 9%, continuing the moderate upward trend that’s been established during last year.

Industry, Analyst