ConstructConnect forecast data shows the West’s nonresidential construction market entering a normalization phase, with starts declining 16.8% from $177.9 billion in 2025 to $148.0 billion in 2027, following completion of several large-scale projects.
Civil construction anchors regional activity, projected at $72.9 billion in 2025 and $69.3 billion in 2027, nearly 47% of total starts, driven by transportation, energy, water, and climate resilience investments.
The industrial, commercial, and medical sectors experience notable contractions, while the government, educational, and military segments post stable or strong growth. This underscores selective opportunities and the need for targeted strategies through 2027.
The Western US nonresidential construction market is set for a notable recalibration between 2025 and 2027. Following a record high, total regional construction starts are forecast to decline from $177.9 billion in 2025 to $148.0 billion by 2027, representing a 16.8% contraction over the period. This adjustment follows the completion of several large-scale projects and marks a normalization phase for the region.
Despite this contraction, the West continues to account for a significant portion of national construction activity. Even with moderate declines, the regional market remains critical for contractors, suppliers, and stakeholders through 2027.
Civil construction continues to anchor the West’s market. Starts are projected at $72.9 billion in 2025, a 2.4% increase from the previous year. By 2027, civil starts are expected to reach $69.3 billion, comprising nearly 47% of all regional activity.
Transportation corridor development, energy infrastructure, water management, and climate resilience initiatives support civil construction’s resilience.
Federal and state investment remains a primary driver, sustaining high levels of infrastructure spending and offering firm opportunities for contractors with expertise in these areas.
Government building activity will see moderate growth over the forecast period. Starts are anticipated to rise from $5.5 billion in 2025 to $5.8 billion in 2027, a 5.7% increase. This reflects continued investment in public facilities, including administrative and safety infrastructure.
Educational construction is projected to grow by 3.8%, from $17.3 billion in 2025 to $18.0 billion by 2027. This measured growth is driven by new and renovated institutional facilities supporting educational demand.
Military construction is forecasted for the strongest percentage growth in the region. Starts are set to increase 28.4%, from $1.9 billion in 2025 to $2.4 billion in 2027. While the absolute dollar value is modest compared to other sectors, this segment presents increasing opportunities for firms in the Military construction sector.
Industrial construction will experience the most significant contraction in the West due to the recent start of a $20 billion TSMC manufacturing plant in Arizona. Starts are expected to fall 61.5%, from $38.4 billion in 2025 to $14.8 billion in 2027. This decline, while substantial, still leaves the sector above pre-pandemic levels, pointing to a solid project pipeline for contractors.
The commercial construction sector is projected to decline by 15.6%, from $17.1 billion in 2025 to $14.4 billion by 2027. Contributing factors include shifting workplace requirements and changing demand for a variety of Commercial spaces.
Medical construction is forecasted to contract by 15.7%, decreasing from $10.6 billion in 2025 to $8.9 billion in 2027. This adjustment follows a period of intensive healthcare facility investment and represents a normalization post-pandemic.
From 2025 through 2027, the West’s construction market transitions from peak activity to a normalization phase characterized by recalibration and selective sector growth. The civil sector remains the primary anchor, with public funding sustaining a strong infrastructure project pipeline.
Stable growth in government, educational, and military construction offers targeted opportunities for contractors positioned in these segments.
Conversely, firms focused on industrial, commercial, or medical building must prepare for reduced volumes and a more competitive environment. Adapting to market shifts by prioritizing modernization, retrofit, and infrastructure upgrades will be critical for maintaining resilience and market share.
Overall, the West region’s construction outlook through 2027 is defined by the shift from historic highs toward sustainable activity levels. Success for construction professionals will depend on prudent sector targeting, operational flexibility, and alignment with evolving market fundamentals.
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