CHICAGO, Nov. 13, 2025 – JLL Project and Development Services (PDS) today released its 2026 U.S. Construction Perspective, revealing how policy-driven market dynamics are creating distinct regional opportunities and competitive advantages across the construction landscape.  

“The construction industry is navigating an unprecedented convergence of policy impacts that are fundamentally reshaping market dynamics,” said Louis Molinini, Head of Project and Development Services for the Americas, JLL. “While much of 2025 was at a standstill due to uncertainty, we now have directional clarity that enables strategic positioning for organizations ready to move beyond reactive approaches.”

Construction spending fell 4.7% in 2025, illustrating the substantial impact of market uncertainty on industry performance. While JLL projects a return to positive territory with 0.4% growth in 2026, this near-flat trajectory underscores ongoing industry pressures and the critical need for localized strategies and adaptive project delivery.

Material cost pressures are expected to intensify throughout 2026. Policy instability and reduced construction demand delayed trade impacts from materializing, creating conditions where cost increases will accelerate with activity.

Construction employment faces structural challenges that extend beyond current market conditions. While reduced construction demand has masked underlying workforce constraints, these latent risks will become acute issues when construction starts rise in earnest. The industry’s traditional employment growth patterns face fundamental disruption with current immigration policies, creating potential bottlenecks as activity accelerates.

“Success in 2026 will require big picture thinking with granular attention to local market details,” said Jaymie Gelino, COO and Head of Work Dynamics Accounts, Project and Development Services, JLL. “Regional exposure to policy impacts varies significantly, creating new growth opportunities that aren’t immediately apparent under traditional market analysis. Even markets facing bigger impacts from ongoing uncertainty remain viable for projects that are matched to local conditions and risks, making granular market understanding essential for identifying the best opportunities.”

Gateway cities like New York have both advantages and vulnerabilities due to their size and diversity. Their large immigrant populations and strong economic connections make them more sensitive to policy changes, but these same features also drive their long-term growth potential. These cities have the infrastructure, talent and capital access needed for success. Organizations can manage policy risks while leveraging these strengths through early contractor partnerships, flexible risk-sharing arrangements and tailored procurement strategies.

“Planning for future activity must account for structural workforce constraints now, as market challenges may compound when construction activity accelerates,” said Andrew Volz, Research Manager, Project and Development Services, JLL. “The intersection of trade policy, immigration enforcement and local economic conditions requires a wholly integrated approach to accurately assess risks.”

Strategic positioning in 2026 will determine success for projects when investment activity accelerates. Efficient planning across industries and markets to address their specific needs is crucial.

JLL Project and Development Services is a leader in the advisory, design, management and delivery of commercial real estate projects for the world’s most prominent corporations, educational institutions, public jurisdictions, healthcare organizations, industrial facilities, retailers, hotels, sports facilities and real estate owners. JLL’s project management team comprises 9,300 project managers across 80 countries with $87.4 billion in projects managed annually. JLL’s design teams consist of 600+ designers across 65 studios in over 30 countries, to service clients with end-to-end design solutions. Visit jll.com/en-us/services/strategy-design to learn more.

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For over 200 years, JLL (NYSE: JLL), a leading global commercial real estate and investment management company, has helped clients buy, build, occupy, manage and invest in a variety of commercial, industrial, hotel, residential and retail properties. A Fortune 500^® company with annual revenue of $23.4 billion and operations in over 80 countries around the world, our more than 113,000 employees bring the power of a global platform combined with local expertise. Driven by our purpose to shape the future of real estate for a better world, we help our clients, people and communities SEE A BRIGHTER WAY^SM. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.