January constructsteel newsletter

In October, US construction starts surged by 21.1%, reaching an annual rate of $1.53 trillion, driven by megaprojects in manufacturing and data centres, according to Dodge Construction Network. Nonresidential starts rose 17.9%, with significant increases in office, data centres, and manufacturing. However, residential construction fell by 15.4%, with a notable decline in multifamily starts.

The federal shutdown in October significantly increased stress in the US construction industry, with the Project Stress Index rising by 1% from September. Public project abandonments surged by 45.8%, while bid date delays increased by 8.5%. Despite these challenges, the overall stress index remains below mid-year levels, indicating resilience in the market. Private sector abandonments fell slightly, with projects on hold dropping by 68.9% since last October. However, ongoing cost pressures and public funding changes continue to challenge project viability.

In October, US construction backlog decreased slightly to 8.4 months, with smaller firms experiencing more significant declines. Larger contractors tied to megaprojects, particularly in data centres, maintain robust backlogs, with firms holding data centre contracts reporting 10.9 months of backlog. This sector’s strength is exemplified by Vantage Data Centres’ $2 billion investment in Virginia and a $15 billion project in Wisconsin.

Germany’s residential construction market shows signs of recovery, with apartment permits rising nearly 60% in September compared to a weak 2024. From January to September 2025, permits increased by 11.7% year-on-year, totalling around 175,600. New building permits rose by 14.2%, while conversions increased by 3.9%.

UK construction activity fell at its fastest rate in five years in October, with the S&P Global UK Construction PMI dropping to 44.1. This marks the tenth consecutive month of decline, the longest since 2008. Civil engineering was the weakest sector, scoring 35.4, while residential and commercial activities also contracted. The downturn is attributed to risk aversion, delayed projects, and economic uncertainty. Despite this, cost inflation slowed, subcontractor availability rose, and optimism slightly improved due to potential interest rate cuts.

Germany’s Bundesrat has approved legislation for industrial-scale underground CO₂ storage, marking a significant policy shift in decarbonisation efforts. The law establishes a framework for CO₂ storage beneath the seabed, excluding protected zones, and allows federal states to authorise onshore storage. A national CO₂ pipeline network will be developed to transport emissions to storage sites. This initiative is crucial for decarbonising hard-to-abate sectors like cement production, according to the Federal Economics Ministry.

Saudi Arabia is set to invest $3 billion in data centres through a partnership between Humain, an AI company owned by the Public Investment Fund, and AirTrunk, a data centre platform backed by Blackstone and the Canada Pension Plan Investment Board. This collaboration aims to support the Kingdom’s ambition for technological advancement and economic diversification, enhancing its global competitiveness in AI and cloud computing.

Built environment tech funding reached $4.4 billion in Q3 2025, a 66% increase from the previous year, driven by AI and robotics innovations, according to Nymbl Ventures. AI technologies secured $2.22 billion YTD, while robotics saw 125% growth with $1.36 billion. Construction tech led with a 150% rise in investments. The sector’s shift towards Series B and later-stage funding highlights a focus on mature, real-world solutions, marking a strategic maturity phase in construction tech investments.

Turner Construction Company has partnered with OpenAI to provide ChatGPT Enterprise access to its 11,000 employees. At its Innovation Summit, Turner showcased AI’s potential through learning sessions and a hackathon, creating over 100 custom AI agents. The company has integrated AI in operations, utilising AI-powered assistants, photo analysis tools, digital tracking systems, autonomous drones, and a Production Control System to enhance safety, planning, and project delivery.

AECOM aims to achieve a 20% profit margin by 2028, leveraging AI and its high-margin advisory business. Despite flat revenue at €16.1 billion in 2025, adjusted net profit rose 14% to $702 million. The order backlog hit a record $24.8 billion. CEO Troy Rudd emphasised AI’s role in reaching the margin target, while President Lara Poloni highlighted growing infrastructure demands and AECOM’s strategic investments in AI and advisory capabilities as key differentiators.

Vienna Airport is investing in a digital twin platform to enhance operations and asset management. This openBIM-based facility management system will create comprehensive digital replicas of the airport’s infrastructure, facilitating efficient process and information sharing. The initiative aims to optimise construction and operational efficiency, supporting sustainable management of the airport’s extensive infrastructure. The airport plans to expand Terminal 3 by 2027, enhancing passenger facilities.

Samsung C&T Engineering & Construction aims to become an “AI native” company by 2028, integrating AI into all workflows and decision-making processes. At its 2025 AI Day, Samsung introduced AI innovations co-developed with AWS, including AI-ITB Reviewer, AI-Contract Manager, and AI-Project Expert (AIPEX). These tools will be applied to new projects starting next year. The company plans a phased AI transformation, focusing on knowledge accumulation, active intelligence, and solving business challenges through AI.

Tutor Perini reported a robust Q3 2025, with a 31% revenue increase y-o-y to $1.42 billion and a $40.1 million profit, driven by strong project execution and improved margins. The firm secured $2 billion in new awards, boosting its backlog to record $21.6 billion. Conversely, Fluor experienced an 18% revenue decline to $3.4 billion, with a $697 million net loss due to an adverse ruling on an Australian project and a write-down on NuScale Power. Despite challenges, Fluor’s new project awards rose 21% to $3.3 billion, and backlog stood at $28.2 billion.

WSP Global achieved double-digit growth in Q3, with a 16% revenue increase to C$3.5 billion, driven by acquisitions and strong North American performance, and a 10.6% rise in order backlog to C$16.4 billion (equivalent to 10.9 months of revenue). AtkinsRéalis saw a 15% revenue rise to C$2.8 billion in Q3 2025, driven by engineering and nuclear demand. Nine-month revenue hit C$8.1 billion, with net income at C$2.5 billion. The backlog reached C$21 billion.

Strabag and Eiffage reported strong Q3 2025 financials. Strabag’s output rose 6% to €14.4 billion for first 3 quarters of 2025, with a record €31.4 billion backlog, driven by the Georgiou Group acquisition. The firm anticipates 7% annual growth, with a raised EBIT margin target of ≥5%. Eiffage’s first 3 quarters’ revenue increased 7.9% to €18.3 billion, with contracting revenue up 9%. Its order book reached €30.8 billion, covering 17.8 months of revenue.

Royal BAM maintained strong performance, targeting a 5% EBITDA margin, with a stable €12.5 billion order book and significant framework wins in the Netherlands and UK. Skanska’s revenue rose 8% to SEK 43.7 billion y-o-y, despite a 17% drop in new orders, bringing the 12-month book-to-build ratio to 106%.

Saudi Arabia’s Public Investment Fund (PIF) sold a 3.3% stake in Masar, the developer of a major Mecca real estate project, for SAR 950 million (US$253 million). PIF retains a 16.3% share. The Masar project, part of Vision 2030, aims to expand Mecca’s capacity for pilgrims, featuring 24,000 hotel rooms and 13,000 residential units, valued at SAR 100 billion (US$26.6 billion).

Ambuja Cements reported a significant profit increase to US$259 million in Q2 FY2026, up from US$55.8 million in FY2025. Revenue rose 18% to US$1.03 billion. The CEO highlighted industry benefits from GST 2.0, CCTS, and coal cess withdrawal. The company plans to boost capacity by 15Mt/yr to 155Mt/yr by FY2028 through cost-effective debottlenecking, enhancing existing capacity utilisation by 3%.