California Construction News staff writer
Construction spending in the Pacific region is forecast to grow 1.7% in 2026, recovering to approximately $303 billion, according to FMI’s annual industry outlook.
After a projected 1% dip in 2025, the region is expected to see stabilization in residential building and continued strength in nonbuilding infrastructure.
Sector Highlights
- Health Care Strength: The Pacific region remains a hotspot for large-scale medical construction. FMI’s report notes that of 15 tracked health system projects valued at $1 billion or more, five are located in California.
- Infrastructure Growth: Nonbuilding structures are a major growth driver, with the sector forecast to expand 6% in 2026. This includes a projected 10% jump in power construction spending and a 2% rise in highway and street spending.
- Water Resilience: Drought resilience is driving investment in the West, with FMI noting that source protection and aquifer storage are taking a larger share of water supply spending.
Residential construction in the Pacific is anticipated to inch up 1% in 2026, with single-family spending seeing a 1% rise after flat performance in 2025.
