Breaking ground: Integration across the construction sector will fuel industry's structural decline

In the five years to 2016, Land Development industry revenue is expected to decline sharply. Although the construction sector has strongly recovered from the economic downturn, the industry has had a reduced role in the construction process, as industry operators focus narrowly on prebuilding activities such as subdivision. Because the construction sector has become increasingly integrated, fewer companies have been able to successfully focus on these activities, in effect reducing industry participation. Meanwhile, many larger construction companies have begun performing land development services themselves, siphoning revenue from the industry. Over the next five years, the industry's structural decline is anticipated to continue, although revenue will decrease at a slower rate...purchase to read more.

Industry Statistics & Market Size
Annual Growth 12-17
Forecast Growth 17-22
Market Share of Companies
There are no companies with a dominant market share in this industry

Industry Threats & Opportunities

  • Construction services have become increasingly integrated, leaving fewer industry-focused companies
  • Well-funded home builders with easy access to credit pose a significant threat
  • Operators will face competition from integrated construction and other real estate investment companies
  • Industry Report - Industry Analysis Chapter

    The Land Development industry has contracted for roughly a decade. The industry endured a sharp recessionary contraction when demand for real estate waned as consumers, banks, investors and builders suffered in the aftermath of the subprime mortgage crisis. However, as demand for construction services rebounded as the wider economy and real estate market improved, the Land Development industry continued to decline due to mounting competition from home builders and other real estate investment and development companies. Consequently, industry revenue is expected to decrease at an annualized rate of 2.2% to $11.4 billion over the five years to 2017, which includes a 1.2% decline expected in 2017 alone...purchase to read more.

    Additional Insights for the Land Development Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Land Development Industry are

  • Easy access to further appropriate land for development
  • Highly trained workforce
  • Capacity to objectively assess new investments
  • IBISWorld analysts also discuss how external factors such as Housing starts and Value of private nonresidential construction in the Land Development industry impact industry performance..

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    What's in this report

    What is the Land Development Industry?

    This industry services raw land (except cemeteries) and subdivides properties into lots for subsequent sale to builders. Land subdivision precedes building activity. Servicing of land may include excavation work for the installation of roads and utility lines, and operators may subcontract excavation and other activities to specialist contractors. Establishments that perform only the legal subdivision of land are not included in this industry.

    Industry Products
  • 100% of services dedicated to developing operator-owned land
  • 90% to 99% of services dedicated to developing operator-owned land
  • 80% to 89% of services dedicated to developing operator-owned land
  • 70% to 79% of services dedicated to developing operator-owned land
  • 60% to 69% of services dedicated to developing operator-owned land
  • 50% to 59% of services dedicated to developing operator-owned land
  • Developing and subdividing customer-owned land
  • Industry Activities
  • Subdividing property (except cemeteries) into lots for sale
  • Developing property for sale (planning, amenities and power)
  • Land acquisition, assembling and subdivision
  • Land subdivision and utility installation (e.g. electric, water and sewer)
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Housing starts
  • Value of private nonresidential construction
  • Office rental vacancy
  • Yield on 10-year Treasury note

  • Current Performance
  • Industry fails to recover
  • Competition accelerates
  • Industry landscape
  • Chart: Revenue Growth

  • Industry Outlook
  • High competition and stagnant industry profit
  • Table: Land Development Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Land Development Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Agriculture, Forestry, Fishing and Hunting
  • Home Builders
  • Apartment & Condominium Construction
  • Industrial Building Construction
  • Heavy Infrastructure Construction
  • Commercial Building Construction
  • Municipal Building Construction

  • Key Selling Industries
  • Construction & Mining Equipment Wholesaling
  • Excavation Contractors
  • Landscape Design
  • Surveying & Mapping Services

  • Products & Services
  • 100% of services dedicated to developing operator-owned land
  • Developing and subdividing customer-owned land
  • 90% to 99% of services dedicated to developing operator-owned land
  • 70% to 79% of services dedicated to developing operator-owned land
  • 80% to 89% of services dedicated to developing operator-owned land
  • 60% to 69% of services dedicated to developing operator-owned land
  • 50% to 59% of services dedicated to developing operator-owned land
  • Chart: Land Development Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Single-family housing construction market
  • Commercial construction market, including retail and office
  • Nonbuilding and other markets
  • Public and institutional construction market
  • Multifamily housing construction market
  • Manufacturing and industrial construction market
  • Chart: Major Market Segmentation for the Land Development Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Chart: Cost Structure Benchmarking – Sector vs Land Development

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Land Development Industry

  • Industry Globalization
    There are no major players in this industry. This report includes analysis of other companies.
    Capital Intensity
  • Chart: Level of Capital Intensity for the Land Development Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Land Development Industry
  • Industry Revenue (2008-2022)
  • Industry Gross Product (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Wages (2008-2022)
  • Housing Starts (2008-2022)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Table: Industry Financial Ratios
    Nonresidential Building
  • A building primarily intended for uses other than long-term residence.
  • Predevelopment Work
  • Refers to activities associated with making a property shovel-ready, such as obtaining regulatory approvals and designing communities.
  • Residential Building
  • A building primarily intended for housing and consisting of one or more dwelling units, a house or other building in which people live.
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    This report on Land Development:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Land Development market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

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