Due to COVID-19, L.E.K. Consulting and Lincoln International canceled the annual Building & Infrastructure Conference in 2020. We hope to host it again in the fall of 2021 in New York City. With the International Builders Show also transitioning to a virtual event in 2021, we thought it was more important than ever to share our perspectives on what we have seen in 2020 in this co-authored report.
With people spending more time at home due to the pandemic, the trend toward “nesting” drove the growth and resilience of residential building products in 2020. For example, residential repair and remodel (R&R) continued to outperform, while housing turnover slowed, and new residential construction accelerated as demand increased for larger single-family homes outside city centers. Conversely, the nonresidential construction market struggled due to the drop in demand for commercial real estate, especially office space. Ecommerce, particularly online purchases of easily shipped R&R projects, continued to grow. Consumers also invested in outdoor living projects, creating more habitable spaces in and around the home and expanding overall square footage.
In this report, L.E.K. and Lincoln examine these and other industry trends — including modular construction, consolidation in distribution and increasing input cost/supply disruptions — in detail. We also explore M&A implications, challenges and growth opportunities.