What is Commercial Construction?

The investment-led construction market in the United States develops essential infrastructure that greatly contributes to national economic growth. Such a large market has plenty of room for contractors, developers, investors, and buyers to operate in multiple sectors such as residential, federal, and of course – commercial construction.

Commercial construction forms the backbone of the public and private sectors’ construction infrastructure. Large urban centers like metropolitan cities rely on commercial builders and construction contractors to build and expand spaces such as office buildings and hospitals. And projects like those that remodel and expand floors in commercial structures require the equipment and project management expertise of a commercial construction professional.

It can be tough to understand which types of construction are ‘commercial construction’ projects and which ones aren’t. As the premier general contracting service in New Jersey commercial construction, KV Builders is pleased to break down the commercial construction landscape and the ways that general contractors deliver value on projects of different sizes and scope.

How is Commercial Construction Different From Residential Construction?

Residential construction projects have just one client providing funds: the single-family party. Single families fund their own renovation and remodeling projects, typically for apartments or homes that either they or a renting tenant occupy.

A commercial construction company, on the other hand, needs to work with more than one client to complete a project. Once they bid on and win awards for work, general contractors are responsible for securing a budget and planning a schedule to meet client milestones, as well as keeping their subcontractors and other involved parties up-to-date on progress.

Commercial Construction Residential Construction

Differences that set residential and commercial construction apart include:


A commercial construction contractor uses steel to frame their buildings, as opposed to residential builders who usually use timber. Steel can support the massive weight of commercial structures like hospitals and offices and, unlike timber, is perfect for taller buildings that need to stand up against wind and rain.


Steel materials are more expensive than timber and concrete, so commercial construction projects usually cost more than residential ones. And since single-family owners are the only ones funding their residential construction, their project costs are lower. Commercial construction has much higher funding ceilings that are agreed upon by multiple parties including developers and the client in addition to the general contractor.

Equipment & Regulations

Contractors need high-powered equipment and machinery to complete commercial projects, and they need to make sure they use them according to commercial regulations. Commercial construction needs larger equipment to build bigger buildings, and contractors need to obtain proper permits and understand state and local building regulations before using them.

Are There Different Types of Commercial Construction?

Cities and surrounding areas rely on commercial construction contractors to support ongoing development and renovation, which means there are multiple types of construction projects as well as contractors to complete them. In fact, the market size for commercial construction was valued at $230B as of 2020, with an impressive number of nearly 70,000 businesses operating in the sector.

A constant stream of contracts for small, medium, and large-scale commercial construction projects contributes to the sector’s consistent growth. The size of project sites, types and costs of construction equipment, and lengths of project schedules are just some of the factors that define the different types of commercial construction work that general contractors perform: 

Interior & Exterior Design

Interior and exterior renovation and remodeling are common for construction projects on smaller commercial properties. These projects require that contractors redesign and fabricate existing rooms and floors, for example, to update their style and completely rebrand their image.

Adding Stories and Expanding Space

Commercial construction projects of a more medium-sized scale typically involve upgrading existing rooms in structures such as office buildings as well as adding entirely new stories to them. Medium-scale projects require more manpower and equipment to ensure contractors complete work on schedule and within budget. 

Large-Scale Commercial Construction

Commercial builders and contractors work with developers and architects to create large-scale construction plans for entirely new buildings. Large-scale construction requires that contractors use zoning codes on agreed-upon plots of land to begin work, which involves significant time and preparation.

The scope and complexity of large-scale commercial construction make it essential for clients to obtain pre-construction consultation and ongoing project management to ensure their final structure adheres to their specifications. KV Builders specializes in commercial construction management, project scheduling, and building and tenant fit-outs to achieve the best perspective on the types of construction work our clients need. 

What is the Future of Commercial Construction?

There’s no shortage of new business opportunities on the horizon for commercial construction contractors. It’s projected that 2019 construction spending in the private sector will end up totaling approximately $977 billion, propelling an ongoing trend into 2020 of increased private sector spending that has continued since 2011.

Construction Spending in the US

This increased spending is good news for commercial construction contractors, 96% of whom were highly or moderately confident in 2019 that they would experience new business opportunities within the next 12 months. 

If you’re ready to start your commercial construction project, you need to figure out your next steps, the professionals at KV Builders can help. Contact us today to learn more about the construction services we provide and how they can make your next project a reality.