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In this paper, we present an algorithm called FOARS for obstacle-avoiding rectilinear Steiner minimal tree (OARSMT) construction. FOARS applies a top-down approach which first partitions the set of pins into several subsets uncluttered by obstacles. Then an obstacle-avoiding Steiner tree is generated for each subset by an obstacle aware version of the rectilinear Steiner minimal tree algorithm FLUTE. Finally, the trees are merged and refined to form the OARSMT. To guide the partitioning of pins, we propose a novel algorithm to construct a linear-sized obstacle-avoiding spanning graph which guarantees to contain a rectilinear minimum spanning tree if there is no obstacle. Experimental results show that FOARS is among the best algorithms in terms of both wirelength and runtime for testcases both with and without obstacles.