Construction Economists Forecast a Surge In 2016

All leading indicators point to a surge in new construction starts in 2016. Does that mean that the recession is finally over? That is still up for debate as we enter a presidential election year and are still dealing with a loss of jobs, high unemployment and of course the extremely high costs associated with socialized medicine.

On the other hand, if you listen to what construction economists are quietly saying, you will hear that there is some light at the end of the tunnel as new construction starts should make some substantial gains in 2016. With the current economic state of affairs in China, I also believe that we will be seeing more companies making business decisions to relocate back to the United States. Interest rates are on the increase domestically, yet we are still struggling with the price of crude oil. I’m not complaining because we are seeing all-time lows in the cost of crude. However, there is ultimately going to be a negative impact on the United States and Canada as long as we continue to depend on OPEC. In my opinion, once we have decided to not pursue our own resources, OPEC will then position itself to implement increases to which we will have no recourse.

The best way to prevent rising energy costs and insulate the U.S. from global price spikes is by actively producing our own American energy resources. This includes more American produced oil, natural gas, coal and nuclear, along with alternative sources such as wind, solar, hydropower and geothermal. Producing more American energy will lower prices, create new American jobs, reduce our dependence on foreign oil, strengthen our national security, and raise new revenue.

Now, back to the current trending of the new construction industry in the United States, Ken Simonson, chief economist for the Associated General Contractors of America is bullish on the market for most types of construction. For example, construction spending increased 14% from September 2014 to September 2015.

According to Robert Murray, chief economist and vice president of Dodge Data & Analytics, “The construction expansion is continuing, and the ongoing increase should result in greater demand for the services of electrical contractors.” If fact, as shown in table 1 below, the economy is expected to grow 3.1% in 2016, and total construction starts are forecast to move upwards by 6% to $712B. Looking at the table, one can see where the current projections are for a 9% increase for non-residential building. Residential is projected to increase by 16%, while the non-building sector will slide by 14%.

Looking at the overall projected health of the construction industry in 2016, most FMI (One of the nation’s leading construction economic & analysis firms) microeconomists are predicting that the total construction put into place will experience a healthy increase of 7%. That includes a 9% jump for residential, a 7% increase for non-residential as well as a 3% shift upwards in non-building (Table 2 below). As previously stated, although single family dwellings are on the upsweep, the multifamily dwellings are going to benefit even more from the construction upswing in 2016. The latest increase by the Federal Reserve is clearly indicative of the bullish market.

The latest economic correction is seeing a much stronger dollar. However, that in turn hurts US exports into those countries that are currently experiencing an economic downward spiral such as China and Europe.

In terms of non-residential markets, the hospitality industry and commercial segments are projected to see gains of 12% and 10% respectfully. This is only for new construction and does not allow for retrofit applications which are projected to experience double digit growth in 2016 in most every segment.

Healthcare is a surprise to me, but is understandable considering several factors such as Obamacare, the rising cost of medical insurance, the loss of medicial jobs, while at the same time, we constinue to be an aging society. Look for that number (4%) to spike into double digits after the presidential election in November. This industry is going to be placed into a position in which it will have no choice other than to increase new construction in 2017.

How does all of this breakdown and what will it mean to you in your region of the country? As the chart below indicates, most every region of the United States with the exception of the South Central States will all share in the uptick of new construction. The South Central portion of the United States is historcially the poorest region and is typically the last to benefit from an economic correction. However, because it is the poorest regional economically, affordable housing is abundant and that region of the country should actually see more growth in residential buildings (both single family dwellings as well as multi-family housing) thank the rest of the nation. The South Atlantic States are positioned to benefit more than any other region of the United States in overall new construction starts.

Robert Murray is projecting a somewhat more than modest upswing in US construction activity across all segments. “We saw a pause in the non-residential building market for 2015, but it followed some good percentage gains for construction starts in 2013 (up 11%) and 2014 (up 24%).” “The market fundamentals still remain positive for commercial buildings, and we are still seeing support for the institutional building sector from the passage of numerous bond construction measures in recent years.”

 

As I eluded to earlier in this report, the retrofit market continues to move forward with tremendous gains in virtually every market segment. The LED replacement lamp market will grow 30% annually, in terms of units sold, between 2012 and 2016 according to new research published by analyst firm Strategies Unlimited.

Strategies Unlimited has published a new report entitled “LED replacement lamp market analysis and forecast” that projects a global LED-retrofit-lamp market that exceeds $3.7 billion by 2016. The growth in solid-state lighting (SSL) products intended for existing sockets is from a $2.2 billion base in 2011, and the firm projects an annual 30% growth in the number of units sold.

According to the report, there were 39.9 million SSL A-lamps (A19 lamps with a legacy Edison base) sold globally in 2011. Strategies Unlimited analyst Katya Evstratyeva said that Japan led the way in consuming LED A-lamps with 24.7 million of the global total. The Japanese Eco-point program was in part responsible for the high market numbers, but Evstratyeva said other factors such as environmental concerns and high prices in compact-fluorescent lamps (CFLs) contributed as well.

Perhaps surprisingly, the market for LED-based linear fluorescent replacement lamps was strong globally as well. Strategies Unlimited reports 19.3 million units sold with 41% of those sales coming in China, 21% in Japan, and only 18% combined in the US and the European Union.

I attribute the lower numbers in the United States to the fact that we are just now beginning to recognize and accept linear LED tubes as a viable and dependable alternative to traditional fluorescent lamps. Further, agencies such as UL & DLC are now listing linear LED tubes as safe and qualified for rebates and incentives. Efficacy levels and L70 data has increased dramatically which is in turn leading to what I believe will be a banner year for this type of retrofit application.

By Tim Hardy, P.E.

Say Goodbye To The 40W And 60W Incandescent Light Bulb

If you have not heard about the 40-watt and 60-watt light bulb ban starting January 1^st, 2014, you are not alone. In a recent survey only 52 percent of American’s had heard anything about it, but that does not mean your 2014 will not be bright. Say hello to the LED light bulb.

The Federal Government’s Energy Policy, the 2007 Energy Independence and Security Act, means this New Year we can say goodbye to the production of the 40W and 60W incandescent bulbs we all grew up with. This adds to the light bulb ban that happened in previous years for the 75W and 100W Edison light bulbs.

Tough new efficiency standards are also pushing the linear fluorescent tube, the popular T12 4’ lamp, to the recycling graveyard. Even the familiar 100W and 150W halogen spots and floodlights must pass new federal energy efficiency policies or face the same fate.

Benefits of quality LED lighting has finally given the U.S. a viable, affordable option, compared to the limitations and poor lighting performance of the compact fluorescent (CFL), which had been the only option for many years. LED lighting will outlast the CFL by tens of thousands of hours while providing even greater energy savings. LED lights also have the added benefit of not needing to be handled as a hazardous material when disposed of. In many utility markets, LED lighting can come with attractive rebates and incentives for the consumer and business owner alike.

For commercial business owners and property managers the message should be clear – it’s time to make the switch to LED lighting and add the savings to your bottom line.

Related articles

• Lights Out For 40W And 60W Incandescent Bulbs (LEDsource.com)

LED Lighting Adds Beauty, Consistency and Value

My friends have been looking at me in a funny way for the last 7 plus years.  You see, I’m in the lighting business, so every place I enter, the first thing I do is look up.  It’s a habit now that seems to drive my wife crazy.  I’m curious how the lighting looks, if all of the color temperatures match, if they have the correct lighting levels, etc.  Until I started doing this, I didn’t realize how unbelievably hard it seems to be to make a clean, beautiful lighting plan work.

If you are the owner of a franchise location (or more than one), you know the importance of keeping the image of the brands you represent consistent.  With traditional lighting technology, the color temperature, hours of life and energy usage vary based on the technology you use, how old the fixtures are, etc.  That means if you open your first location one year and a second two years later, you may not be able to match the lighting between them.  What can you do to make everything the same?

Moving into LED Lighting Solutions is the key.  With the manufacturers we work with (including Philips, Cree, Toshiba, Lighting Science Group and others) we can give you a consistent lighting look across all of your locations.  Every lamp will match, the output will be the same and we can easily take the lighting you have now, convert it to LED and save you between 50 and 75 percent of your energy cost on lighting.  Add in the benefits of long life (50,000+ hours), long warranties (up to 10 years) and absolutely color consistency and you can see that LED is ideal for operators of franchise locations.  The lighting is a huge part of making your product, both the storefront and your merchandise, look the same in the best possible manner.

Every day that you wait to move into LED is a day of savings lost.  There is absolutely no reason to wait, especially with our LouMan Money program.  Get in touch with us today to explore how LED Source can make your business shine like never before (and for a lot less money out of your pocket each month).  Our experience with brands such as Massage Envy, Starbucks, Marriott, City Furniture, Hurricane Grill & Wings and others, has taught us a lot about how to work with a franchisee and franchisor to make it happen.  LED Source, being North America’s only LED lighting franchisor, also provides us special insight into the importance of respecting both the unit owners and the corporate higher-ups.

For more information on LED Source and our franchise opportunity please call us at 866.900.4533 or www.LEDsource.com

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The Durability of LED Lighting Fixtures

On a recent sales trip to Orlando, I was performing an LED fixture demo at a warehouse for a client. The Philips ExceLine 4-Pod BayLyter HighBay LED fixture met the client’s project goals and was the fixture selected.

As any good sales person knows, the best way to demo a fixture is to show the customer how it will work in their environment. At the warehouse, the client had a large gantry crane and the idea to lower the hook, connect the fixture and raise it to the ceiling. This way the BayLyter would illuminate the area at approximately the same height as the existing metal halide fixtures. Sounds like a good idea in theory right?

As I proceeded with the demo and connected the BayLyter LED fixture to the crane, at about 15 feet in the air, my worst fear came true. The cable on the crane broke right at the hook and the fixture came crashing to the ground. The BayLyter landed on the power cord, immediately severing it and making the warehouse go completely black. The existing metal halide lights in the warehouse were turned on, and after they warmed up in about 5 minutes, we went to survey the damage. The BayLyter LED fixture had landed on one of its corners and took a 5”x2”x1” deep chuck out of the concrete floor. The corner on the LED fixture was dented and one of the four pods on the BayLyter was knocked loose. To my amazement, the glass was not broken and the LED boards were still attached and intact. Needless to say I had to reschedule the demo, but that is only one part of the story.

The next morning at the office, I decided to see if the BayLyter still worked. After attaching a new power cord, I plugged it in and yes the fixture worked perfectly. All the LEDs from each board lit up, even though it dropped from about 15 feet. The only thing that needed to be fixed was the bracket that held in one of the LED boards.

All of us in the LED lighting industry love to speak about how durable LEDs are, but have you ever heard of a fixture being dropped from this height and still working? Could your metal halide fixture do this?

In the past, I have heard a story of an electrician on a ladder installing a Lighting Science LED lamp in a recessed can, loosing his grip, dropping it and still working, but nothing to this extreme. I too have dropped a Toshiba LED lamp from a second story balcony and it survived. I find it amazing to see that with all these similar stories involving an LED lamp or fixture falling, the end result is still the same – the LEDs continued to worked.

Imagine the above situation happening with a T5 High Output HighBay. I can guarantee the lamps would all be broken, and you would have to evacuate the area because of the poisonous mercury that was just released. When the dust settled and the area cleaned, you would find the fixture completely destroyed. The reflector would be bent and I am certain there would be a few sockets broken. Basically the fixture would be useless.

The next time you are thinking of upgrading the lighting in your warehouse, be sure to consider the many benefits and durability LED lamps and fixtures can offer.

For more information, contact the LED lighting experts at LED Source®.

Nothing Out Of Pocket For LED Lighting

I know it sounds a little “pitchy” but in fact, this is 100% a true story. Our company has recently started a finance program appropriately titled “LouMan Money®” in order to fund Lighting Solutions for our commercial clients. LouMan Money® provides not only the financing for lighting products, but will also include all design, install and even disposal or recycling costs for the products being removed.

So what does this all mean to you? I am glad you asked!

Lets say we use our fancy analysis tool, the Lampinator®, to figure out what you’ve got  for existing lighting and what LED products we’ll put in to replace it. For the sake of this example, lets say that we determine we are saving you $10,000 / year with an initial cost of $20,000 in product, installation, etc. So, that’s pretty easy math, right? $20,000 will take exactly two years to reach “payback”. Then, we can dig a little deeper and calculate ROI (Return On Investment) based on the expected life of the state-of-the-art LED products. Lets use 10 years for the sake of this example. So how does the math look so far?

• Investment: $20,000
• Annual Savings: $10,000
• Payback Period:  2 years
• Life of new LEDs 10 years

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So based on the above, your eventual ROI (not including rate increases, inflation, etc) will be (savings) 10,000 X (life in years) 10 – (Investment) 20,000 = $80,000. Yes, it’s true. In 10 years, you will have earned a profit of 80,000 on your initial investment of 20,000. Sure, some will say “but what if those products don’t last the full 10 years”… well, even though the rating on the lamps may be as long as 20+ years, lets say they ONLY last the 5 year warranty… you’re still looking at a $30,000 profit on the 20,000 investment.

The argument then can only be “well, we’ve been through a rough 5 or 6 years with this crazy economy. For our business to put $20,000 into lighting products, when our lights are working perfectly makes little sense to us”. I understand. Trust me, in my own businesses, it’s hard to justify investments in anything other than staff and inventory.

The answer is this. “Invest someone else’s money!” This is where we come in. LouMan Money® allows our clients to pay for the entire project, from start to finish, with other people’s money. We match the payment closely to the savings, then give you all sorts of options on what you want to do. Lets say for example:

• Project Total: $20,000
• Monthly Savings:  $833
• Down Payment:  $0
• LouMan Money 24 mos: $891
• LouMan Money 36 mos: $612
• LouMan Money 12 mos: $1,726

So, using this example, if you pay for the lights over 36 months, you’re seeing Positive Cashflow from month 1 of $221 from the very first month. You’ve paid nothing out of pocket, there are no personal guarantees (in most cases) and only the LED lighting serves as collateral. Yet, you are realizing savings month one!

You also have options to pay for the lights in a shorter, or sometimes even a longer period. The flexibility is there.

LouMan Money® offers so many more benefits including easy application process, the availability of master lines (allowing you to approve multiple locations at once, but ship only as needed), and much more. Heck, we can even easily finance governments and municipalities! The goal is only to provide as many businesses as possible with better lighting solutions, improving the world and your bottom line while we do it.

For more information on LouMan Money® or LED lighting products, visit www.LEDsource.com or call (866) 900-4LED (4533).

SITE Lighting With LEDs

From the first use of the Light Emitting Diode (LED) as a light source, the last 40+ years have seen this little guy mature into a viable source for many conventional lighting uses.

Prior to the Trichromatic and Phosphor based LED technology, the only way to achieve white light from an LED source was to combine an equal amount of Red, Green and Blue light to produce white. In many cases, the Blue LED could be seen over the Red and Green, thus making the source unusable for most white light applications.

Since that time, LED white light technology has rapidly improved and now the technology is considered a stable source. Among the first applications for LED lighting included cove lighting, under cabinet and task lighting.  Typically these applications were reserved for fluorescent or xenon light sources, but by using LEDs, users started to see the many benefits such as much longer life expectancy, cooler operating temperatures and lower energy.

The development of LED lighting technology continues to improve, so much so that it can now be used in almost any application. Simply by banking a number of high intensity LED’s in a small area and incorporating the correct optics for an even light distribution, LEDs are now a viable option for site/street lighting.

Whether you are lighting city streets, parking lots or an entire campus, there is an LED fixture that can fulfill your needs. Typically the source for these applications is either 250-575 watt Metal Halide or High Pressure Sodium fixtures.  However, these fixtures are not instant re-strike and usually only last around 15000-16000 hours. Whereas LED lamps are just the opposite. They are able to instantly re-strike and can last up to 70,000 hours. This translates to a large safety benefit in that the re-strike happens immediately leaving no one left in the dark.

Maintenance is another key benefit. Typically the Metal Halide and High Pressure Sodium sources start to degrade over time, begin to flicker, burnout, and in some cases, explode. LEDs provide a reliable light source and require no maintenance.

These two factors alone should convince anyone that LEDs are the clear choice. Most manufacturers have scaled their street lighting product lines to accommodate any application.  From the lowest level of LED density with a quantity of 40 (3,480 lumens), to the highest level of LED density with quantity of 160 (18,062 lumens), there is a fixture for any application.

With the introduction of LED technology into this arena, numerous other energy-saving options are available. LEDs save around 75% of the energy used when compared to traditional light sources. Also most of the LED engines contained in the street lighting fixtures are intelligent and can be programmed. A great example of this would be if an office closes at 6pm and the majority of the employees leave around that time, the parking lot fixtures would have to be at full capacity to around 8pm.  However, after 8pm, there would still be a minimum requirement lighting level. The LED street lighting fixtures could be programmed to reduce light levels by 50% to 75% thus adding to the additional energy savings.

Besides the many benefits with LED site lighting, many States are offering tax incentives or rebates, making it even more attractive to make the switch.

For more information on LED site lighting, contact the LED lighting Experts at LED Source®.

LED Lighting Is Getting Better By The Day

We get a lot of customers who hold off on LED lighting, citing that the price will go down and that they’ll get more bang for their buck in a year or two.  Is that really true?

 

The short answer is no, it’s not.  LED lighting fixtures are like computers in that way.   Both are a solid-state technology (computer chips and LED diodes).  You’ll notice that computers always cost about the same amount, but what you get for the money changes.  You’ll get a faster; better computer in two years for the same money, but you’ll be without a computer for two years.  Does that make it a better deal?

The shift is even more radical with LEDs.  How much money would you save in a year or two using LED lamps as opposed to the other, less efficient alternatives?  In a lot of cases, you’ll save more than the cost of the lamps in that timeframe.  How much more will you enjoy the beautiful, rich lighting that you can have in your home now instead of waiting two years for lights that may or may not be less expensive?  It’s hard to quantify everything with LEDs, but the monetary savings are certainly there.  I think the other parts of this equation, the beautiful light you’ll enjoy, the maintenance free lifetime of use you’ll get, etc. far outweigh waiting it out for something cheaper.  It might not even happen.

Not only that, but there are many local, state, federal and even energy provider rebates available for LED lights these days.  In many cases, you can get back most of the purchase price of the products.  If you’re looking into LED for your home or business, contact LED Source for some insight on how to get these lamps and fixtures working for you today instead of sitting on the sidelines, waiting for something to happen.  Don’t be the one who waits for great things to happen to them, make great things happen now, and start with LED!

For more information on LED lighting, visit the LED lighting Experts at www.LEDsource.com

Now Is The Time For Schools To Use LED Lighting

Ever wonder why our schools do a great job in recycling paper and other items, but do not take advantage of LED lighting?

Think of how many resources we would save by not having to replace lamps every year.

What about mercury? How is my child exposed to mercury at school you ask?

Mercury is in every fluorescent lamp, which is the predominant lamp choice in schools, which just happens to be the type of lamp directly over your child while in class. We all know the effects of mercury in children by now. In fact the Environmental Protection Agency (EPA) has forced a label to be placed on all fluorescent lamp packages, which clearly states its hazards in very fine writing. The EPA goes as far as telling us how the fluorescent lamp needs to be handled when one is broken in a public place, which clearly states:

1. That the area where the lamp is broken must be evacuated
2. All dust and fragments from the broken lamp must be picked up using duct tape to capture all mercury particles
3. All the broken pieces must be double bagged and disposed of as hazardous waste

When was the last time you heard your child say their school was evacuated due to a broken bulb? Or when is the last time you saw your child’s school janitor pull out his duct tape instead of his broom and dispose a lamp as hazardous waste?

LED Lighting Benefits:

1. Contains no mercury, not even lead in its soldier
2. Is completely environmentally safe
3. All parts are recyclable
4. Provides more of a comfortable light, which helps our students see better without glare and eye strain
5. Saves on average 70% in energy savings reducing our school operating budgets, which ultimately save us taxpayer’s money

What about maintenance costs you ask? We are all aware of how many budget cuts our schools have been faced with which has decreased maintenance staff. This makes it more difficult for the remaining maintenance personal to keep up with demand. Well just imagine telling them not to worry about changing a lamp for at least 10 years or more. LED lamps also take an amazing amount of abuse compared to incandescent and fluorescent bulbs, which makes it a better choice vandalism.

There are many LED retrofit lamps available on the market today that will easily replace existing lighting without costing our school districts additional expenditures. In fact, with the amount of savings in energy and maintenance costs, the LED retrofit usually pays itself back within 1 to 2 years.

Today there are many quality LED products for all areas in the school including gymnasiums, parking lot lighting, classrooms and common areas.

The key to a good LED retrofit is selecting the right products that will fit the application. This requires hiring a professional LED company that can keep you from wasting lots of time and money on poor products. Not all LED lamps and fixtures are alike so BEWARE!! Many fail to live up to their claims and many are made with cheap and poorly designed technology. Do not get misguided by all the competition.

Conventional and LED lighting are not the same and many conventional lighting competitors try to compete in the LED market to stay alive. It’s very important to pick a reputable and knowledgeable LED company that has a proven track record.

Do your homework and check out your supplier. Always aim for a company that only specializes in LED lighting. After all, would you go to a plastic surgeon for your heart problem? LED lighting professionals and experts spend an enormous amount of time scrutinizing everyone’s products and they take the headaches and confusion away.

So what are you waiting for? Change your school to LEDs and let our children and your budgets breathe fresh air again.

For more information, contact the LED lighting Experts are LED Source – 866.900.4533 (4LED) or visit www.LEDsource.com.

Science and Saving Money with LED Lighting

As you enjoy the warm summer weather, we want to get you ready for winter.  It seems like winter is getting colder and colder each year.  How can Light Emitting Diodes (LEDs) and the light they create save you money and keep your home warmer?

Most people don’t realize the huge effect that lighting has on your heating costs, but they add up.  All incandescent and compact fluorescent lamps create heat, and you would think that would help add to the heat in your house and lower your bill.  But that’s not the case at all with recessed fixtures.

Have you ever felt a draft come in from recessed lighting in your ceiling? It’s not just that the can isn’t sealed up properly (it’s pretty difficult to get an air-tight seal), it’s the Venturi Effect.  Whenever you heat up gas it increases the rate at which it rises.  That creates a “chimney” or “stack effect” that makes your precious, expensively heated air shoot out of those recessed lights even more quickly than just from the whole in your ceiling.  As your lights are on more in the dark winter months, they’re literally shooting warm air out of your ceiling, into your attic and out into the world, costing you big dollars.

Since LED lighting doesn’t get nearly as hot as compact fluorescent or incandescent lights the air that escapes it greatly slowed, giving what’s been known as a “draft buster effect.”  Places that used to feel cold and drafty in your home will now feel warmer, with less gas or electric heat required to do so.  You win in two ways, a lower heating bill and a warmer, cozier room.  Tough to beat that, isn’t it?

The best part about all of this is that it saves you more money on top of the electricity savings the lamps already provide.  And during the summer, the lamps aren’t getting hot, so your air conditioning bill is lower.  LED lighting is the only lighting solution that is good for your wallet, your comfort and your pocket.

For more information on LED Lighting, ask the Experts at LED Source. Call us at 866.900.4LED or visit our website at www.LEDsource.com

LED Lighting Expert Interviewed On FOX News Live

It is amazing to see how the world is embracing LED lighting. Everyday we help to educate people on the benefits and savings of LEDs.

Government incentives and rebates are helping to move LED lighting to the masses, as well as the need to reduce energy consumption.

FOX News Live, one of the nation’s top rated news programs that focuses on topics of the day and how they impact businesses, recently interviewed LED Source® President and CEO, Marcel Fairbairn. Marcel provided his expert insight on LED lighting and also how he started LED Source®, the first and only LED lighting franchisor in North America.

Watch the complete interview by Clicking Here.

For more on LED Source® and how we can help you with your next lighting project, contact one of our LED Lighting Experts at 866.900.4LED or visit our website at www.LEDsource.com