Artificial turf and renewed demand for construction will stimulate revenue growth
Los Angeles, CA (PRWEB) April 19, 2012
Growth in the Sports and Athletic Field Construction industry has slowed considerably during the past five years. According to industry analyst Brian Bueno, “the collapse in the construction market and subsequent recession in the late 2000s hampered demand for field construction services.” Some sports venues reduced investment in upgrades, while colleges and other markets postponed projects. These negative trends reduced industry revenue, despite growing demand for alternative fields, such as artificial turf. Revenue continued falling through 2011, as municipalities and schools canceled construction projects due to weakened state and federal funding. In 2012, industry revenue is anticipated to increase by a minimal 0.1% to $2.6 billion, marking annualized growth of 0.8% since 2007.
Universities and colleges are currently the largest market for the Sports and Athletic Field Construction industry. Unfortunately, demand from this segment has declined during recent years, particularly from public colleges facing lower government funding. While demand from private colleges has been more resilient than some other markets (e.g. golf courses), the financial crisis limited many colleges' ability to invest in new sports and athletic fields. Many private colleges rely on endowments and donations from alumni. Nevertheless, a decline in per capita disposable income caused many alumni to cut back on discretionary spending following the recession. Consequently, charitable donations to public and private schools have decreased. Bueno says, “endowment funds lost about a quarter of their value during the recession, forcing many institutions to cancel construction projects.”
Some of the larger industry companies have contracts with organizations like universities and professional sports organizations to secure revenue. Nevertheless, the industry remains highly fragmented; the two largest players are Sports Construction Group and Bush Turf. The industry is expected to enter a period of relatively strong growth over the next five years. As the US economic recovery gains steam, construction projects are projected to revive. Further, the demand for the installation and maintenance of sports and athletic fields will also improve. The installation of new artificial (i.e. synthetic) turf is also expected to increase in popularity. Overall, industry revenue is forecast to grow at moderate rate in the five years to 2017.
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This industry constructs and installs athletic and sports fields (such as for football, baseball, soccer and lacrosse). Companies construct artificial turf for sports fields; install grass fields; install athletic track; construct or install embedded equipment (e.g. goal posts, cages, protective netting and scoreboards); construct and install bleachers and install lighting. This industry does not include sports stadium construction.
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