2024 marked a record year for sales and revenue at Register Roofing. As we look ahead to 2025, we remain both optimistic and cautious. Our annual market outlook article explores the factors contributing to our balanced view of the upcoming year. Hope you enjoy the read.
Strong Public Spending Fuels Growth
Government spending at the local, state, and federal level remains robust, with funding flowing into a variety of projects. Municipalities, including school boards and city or county agencies, are actively investing in their infrastructure. In Florida, a deferred maintenance program provided counties, colleges, and other state-funded institutions with additional funding to address maintenance backlogs caused by the COVID-19 pandemic and supply chain disruptions. This funding spurred upgrades, such as roofing projects, and created a surge of work for public sector clients. With this program extending over three years, we anticipate continued investment in these facilities.
Private Sector Boom Drives Infrastructure
In the private sector, interest rates significantly influence activity. Here in Northeast Florida, population growth continues to drive demand for infrastructure. As more people move into the region, services like retail, healthcare, and entertainment expand, leading to new construction projects. Historically underdeveloped areas—such as northern St. Johns County, the north side of Jacksonville, and regions along major parkways—are seeing rapid development, with housing projects followed by shopping centers, hospitals, and schools. This growth reflects the population boom from 2020-2022 and the ongoing need for supportive infrastructure.
Downtown Jacksonville is also experiencing a resurgence, with the Downtown Investment Authority advancing projects that had been in planning stages for years. Recent permits and city council approvals have catalyzed these developments. Large projects tend to raise surrounding property values, prompting additional infrastructure investments.
Overall, activity across private and public sectors remains high, with roofing contractors, general contractors, architects, and engineers all maintaining steady workloads. Our backlog—representing contracted but unbilled work—remains comparable to last year, signaling a healthy pipeline and continued strong demand for our services.
Material Pricing Finds Stability
Many challenges from recent years, such as material price inflation, labor shortages, and logistical bottlenecks, have eased. Material availability has greatly improved, with most orders being fulfilled within weeks. Pricing has also stabilized year over year. During the second half of 2024, some material prices dropped due to a slowdown in national demand. However, early 2025 has brought calculated price increases on specific product lines, such as PVC roofing materials, driven by rising raw material costs. For other materials like modified bitumen membranes, TPO membranes, and polyiso insulation, we anticipate modest increases of 3-5% in the first half of 2025.
One encouraging trend is the advanced notice manufacturers now provide for price adjustments. This allows us to communicate changes to clients and potentially mitigate cost increases. While minor price hikes are expected in early 2025, we anticipate stability or even decreases later in the year as manufacturers adapt to market conditions. Overall, material pricing is steady, with manageable fluctuations.
Potential Labor Market Challenges Ahead
Labor remains a key variable in 2025, partly due to federal immigration policy changes under the Trump administration. Stricter enforcement of immigration laws may reduce the availability of undocumented labor in the construction industry. Although Register Roofing exclusively employs authorized workers through the E-Verify system, these broader labor market disruptions could indirectly affect us. If competitors lose access to undocumented labor, they may compete more aggressively for skilled workers, driving up wages and tightening labor availability.
Despite these potential challenges, our commitment to legal and well-trained employees positions us as a reliable employer and contractor. However, the industry-wide labor shortage will likely remain an issue, affecting project timelines and costs.
Consolidation Through Mergers
Private equity investment in blue-collar industries, particularly construction and manufacturing, has accelerated in recent years. Since this trend began, investment firms have increasingly targeted roofing companies for acquisition. In 2024 alone, two major competitors in Northeast Florida were acquired by private equity firms, altering the competitive landscape. Many local companies are no longer independently owned.
Register Roofing remains a second-generation, family-owned business. Our local ownership enables us to make decisions in the best interests of our employees and clients. This independence is a unique selling point, setting us apart in the market and helping us attract both talent and clients. We emphasize this advantage in our messaging, reinforcing our commitment to community-focused service.
Mergers and acquisitions also extend to manufacturers and distributors. Notable transactions in 2024 included Home Depot’s acquisition of SRS Distribution and United Rentals’ purchase of H&E Rentals. This consolidation among major suppliers could influence pricing and product availability, though the full impact remains to be seen.
Conclusion
The commercial roofing industry remains strong, with high demand across public and private sectors. Pricing is stabilizing, labor challenges persist, and mergers and acquisitions continue to reshape the competitive landscape. Register Roofing is well-positioned to navigate these changes, leveraging our local ownership and expertise to deliver exceptional value to our clients and employees.