The clearest expression of that ambition is the Railyards mixed-use project, a 244-acre former rail property that is moving out of infrastructure and planning into vertical construction. Kaiser Permanente’s 18-acre medical campus at the site is underway and scheduled to open in 2029, and a soccer-first stadium with more than 20,000 seats for Sacramento Republic FC is targeted for 2028.

“The architectural challenge is now less about attracting individual anchor projects and more about connecting them into a functioning district,” says Jim Marsh, president and CEO of CSHQA.

Housing, transit, walkable streets and active ground-floor uses will decide whether the Railyards extends downtown or becomes a collection of large, inward-facing campuses.

And the bustle in the city during the workweek has grown. California’s four-day in-office requirement took effect July 1. Early location data showed downtown foot traffic roughly 12% higher than the same period a year earlier, although that data covered only the policy’s first several days.

The construction numbers behind all this are settling rather than surging. According to Dodge Data & Analytics, regional starts hit $11.4 billion in 2024, then were forecast to fall more than 20% to $9.1 billion before recovering to $9.8 billion.

That 2024 peak was almost entirely one sector. Health care facility starts reached $3.9 billion that year, against $564 million two years earlier. The spike was likely related to a boom in hospital construction driven by a looming deadline to meet state seismic-resilience standards by 2030. Institutional starts overall have since been forecast back to roughly $1.9 billion.

Underneath the swing, the steadier line is housing. Residential starts have climbed every year, from $3.3 billion in 2022 toward a forecast $4 billion, with single-family accounting for about three-quarters of the total.

The dominant trend, Marsh says, is a move away from speculative development toward projects backed by a committed user, a public mission or demonstrated neighborhood demand. Sacramento had roughly 130,000 sq ft of office construction underway in mid-2026, mainly driven by tenants.

Dodge shows the same thing. Office and bank building starts were $502 million in 2022, collapsing to $98 million in 2023 and forecast only as high as $253 million through 2026—half the 2022 figure.

Tenants that are moving continue to favor newer or renovated buildings, which leaves older properties in a difficult middle ground.

“Office-to-residential conversion will remain part of the conversation, but it will occur building by building rather than as a broad solution,” Marsh says. Floor-plate depth, window access, plumbing distribution, seismic conditions and acquisition cost all remain decisive.

School work should grow. Proposition 2 authorized $10 billion for education facilities—$8.5 billion for K-12 and $1.5 billion for community colleges—though Marsh expects it to enter the market over several years. Dodge has education starts recovering from $350 million in 2024 to a forecast high of $566 million, still well below the $863 million reached in 2022.

The harder problem is not that construction is expensive, but that costs and availability remain difficult to predict.

“Owners are asking for cost certainty earlier, often before the design is developed enough to provide it,” Marsh says. That pushes long-lead items, procurement risk and realistic allowances into programming and schematic design.

Sacramento enters that uncertainty from a steady position. Metro unemployment was 4.8% in June against 5.2% statewide, and the region leans more on government, health care and education than on venture-funded technology.

The region is not immune to the industrywide shortage of skilled labor though the effects vary by trade and contractor rather than showing up as a uniform regional wage increase.

Federal tariffs now reach 50% on certain covered steel, aluminum and copper imports, with different rates on some derivative products. Whether a project feels that depends on where a product is made, how it is classified and whether an equivalent domestic source exists.

Public work carries its own exposure; transportation reauthorization after Sept. 30 remains unresolved, though obligated projects won’t vanish on that date. Dodge has highway and bridge starts holding near $1 billion.