Asia Set to Scrape the Heavens
Constructing the Empire State Building consumed 60,000 tons of steel…10 million bricks…1,172 miles of elevator cables…6,400 windows…60 miles of water pipes and over 3,500 miles of telephone and telegraph wires.
But the world’s tallest skyscraper is much more than the world’s top-quality office space. It symbolized the progress of a nation rebuilding — a beacon of economic growth. The strength of its image became universal.
One could argue the construction of the Empire State Building was a turning point for the U.S. economy and morale during the heart of the Great Depression, ushering in the world’s first skyscraper boom.
Soon, skyscrapers began popping up throughout the American landscape: In Atlanta, Dallas, Houston, Charlotte…the World Trade Center in 1972…the Sears Tower in ‘73. Every U.S. skyline you see today grew in a span of about 40 years.
Right now, the world’s “second skyscraper boom” is currently under way, and to no one’s surprise, it’s happening in the newest region of massive economic growth…Asia.
These buildings require miles and miles of steel beams…hundreds of thousands of tons of cement… The Twin Towers alone consumed roughly 425,000 cubic yards of concrete… That’s enough concrete to lay a sidewalk five feet wide from New York to Washington, D.C. The building also required 12,000 miles of electric cable…198 miles of heating ducts…and 200,000 tons of steel.
Few people have ever stopped to think about the massive amounts of steel and cement that go into these structures. But those who did — especially in the early 1900s — could have made a fortune, especially those invested in steel.
Between 1904-1930, shares of U.S. Steel (X: NYSE) rose an average of 66% a year! Of all the components used in skyscrapers, steel grasps my interest the most.
Steel products are used in everything from the construction of buildings, bridges, railway rolling stocks, industrial pipes and tanks to numerous automobile parts and Campbell’s Soup cans.
If steel production per person in China alone were to climb to U.S. levels, it would mean that China’s aggregate steel use would double by the year 2031, to a level equal to the current consumption of the entire Western world. And when you add in developing countries like India, Malaysia, Indonesia and Vietnam, the numbers become staggering. We’ll get to the specific figures in a minute.
But first, think of this…
Unlike the general use we see here in the U.S., high-rise buildings in Asia will provide much more than Grade A office space… These buildings will be the bedrock for the region’s rapidly emerging middle-class housing.
You may remember the Levittowns that shot up across the United States over 50 years ago. These carefully planned neighborhoods provided affordable housing for the thousands of young soldiers returning home from World War II. But more importantly, these planned neighborhoods served as the new model for America’s booming middle-class suburban lifestyle.
The emerging markets of Southeast Asia are currently experiencing a similar transformation.Except, they’re not peppering the landscape with tree-lined streets and 2.5-bedroom, 1.5-story ranch houses.
