Commercial builders and managers already scrambling to adapt to high steel building prices from three years ago are bracing themselves for a predicted 25 percent cost increase in 2008.

Northern New Jersey construction and project-management companies are placing more emphasis on cost-control measures, as more projects are now being reconfigured in the design phases to stay within budget.

The price of nearly every type of steel more than doubled in the U.S. in 2004, which increased the costs of most projects that use metal.

In New Jersey, this has boosted the costs of schools and slowed the construction of offices and other commercial metal buildings.

A massive steel building boom in the Middle East and Asian markets has driven up the demand for product, slowing the supply dramatically in the U.S.

As China, the world's fastest-growing economy, consumes more metal, global steel building prices will undeniably increase.

Demand for iron ore will rise by as much as 55 million metric tons in each of the next three to four years, according to experts.

Builders and project managers see few alternatives to the rise in prices for metal building materials, unfortunately.

To cut costs, many residential home builders are shying away from steel where they can, and using various forms of concrete.

This is not always practical or even possible for commercial steel building, however, nor is it necessarily cheaper.

Officials point out that concrete structures erected in place of a metal building still require steel reinforcement.

"Steel is really the only way we build today," said one New Jersey builder. "Concrete is only used in specific projects, such as apartment buildings. Steel commercially is used in 90 percent of our projects."

Because public projects almost always have tightly defined budgets, the possibility of a renewed increase in steel building prices is a vexing problem to many commercial real estate businesses.

"I don't think the industry has figured out what to do yet," said one developer. "Clients have to understand it's going to cost them more."