“A few years ago, the question was often, ‘How quickly can we get started?’” says Don Kowalchuk, executive vice president and general manager at Skanska USA Building. “Today, owners are more likely to ask whether a project is the right investment, whether it can meet the budget and how escalation, material selection and program priorities will be managed.”

The wary approach is understandable. Regional construction starts bottomed at just around $12 billion in 2023-2024 after a steady slide, according to Dodge Data & Analytics. Starts were then forecast to surge 28% to $15.5 billion and keep climbing past $17 billion, putting the region well above where it stood before the slump.

Projects with clear purpose, secure funding and long-term operational value are moving forward. Projects facing a battery of unknowns are facing more scrutiny, even if the upside might seem to make them worth it.

The office market shows both halves of the story. Office and bank building starts collapsed more than 72% between 2022 and 2023, falling from $1.7 billion to $475 million. They have recovered since and topped $822 million in 2024, with forecasts running past $2 billion for 2026. That would be record-setting territory for the region, but it follows two years of listless activity.

For firms intending to take advantage of the upswing, looking farther afield might be advisable.

“The market is no longer just focused on Seattle,” he says. “It now functions as a connected Puget Sound market.” Bellevue and the Eastside remain central, but Lynnwood, Shoreline, Redmond, Renton, Kent, Everett, Tacoma, Federal Way and Bothell are all drawing investment.

The strongest sustained demand is in institutional and infrastructure work—health care, transportation, aviation, utilities, higher education, advanced manufacturing and data centers.

Public infrastructure carries much of it. Highway and bridge starts reached $2.5 billion in 2024 and are forecast to hold above $2.4 billion. Other public works, at $284 million in 2024, are forecast to more than quadruple. Utility starts, negligible for years, are forecast above $490 million—a category that tracks directly onto the energy-capacity constraints Kowalchuk names as a regional pressure point.

Office buildings, which languished at $475 million in 2023, are expected to grow to $2.1 billion this year, an increase of almost 343%.

Housing is climbing on the multifamily side, from $2.5 billion in 2024 toward a forecast $3.4 billion, while single-family remains below where it stood at the start of the decade.

And beyond the Puget Sound region, opportunities are emerging, Kowalchuk notes.

The growth in Eastern Washington, notably Spokane, Pullman and the Tri-Cities (Kennewick, Pasco, and Richland) has surged ahead, fueled by manufacturing, industrial development, higher education and agriculture. Western Washington simply cannot match the pace.

Manufacturing building starts in the Seattle-Tacoma-Bellevue area ran under $100 million in 2024 and are forecast to decline. In the Tri-Cities, a metro a fraction of the size, manufacturing starts topped $254 million in 2023 and are forecast back to that level.

The Seattle area still has an array of advantages that should keep it on an upward trajectory. Western Washington boasts a skilled workforce, sophisticated owners and high sustainability expectations, which bode well, despite raising the specter of some of wider industry concerns.

“This region has a high concentration of complex projects,” Kowalchuk says. Those rely on specialized mechanical, electrical, plumbing, fire protection, controls and commissioning expertise, and when demand runs high in those trades it affects pricing, availability and schedule certainty.

Supply chains have improved but still need to be managed. Electrical gear, mechanical equipment and structural steel remain long-lead items, and tariff uncertainty has made historical cost assumptions less reliable.

The workforce constraint extends beyond the Puget Sound region into Eastern Washington, where the same craft professionals and subcontractor base are needed to support a growing pipeline.

To put the market situation in a nutshell, Kowalchuk says succinctly: “Active, but disciplined.”