Archinect - News

Construction starts rise 5% in November, led by booming nonbuilding market

2024-12-19T14:55:00-05:00

The total number of construction starts increased by 5% in November to a seasonally adjusted annual rate of $1.2 trillion. According to Dodge Construction Network, nonresidential building starts grew by 2%, nonbuilding starts were 16% high, and residential starts fell by 1%.

For the 12 months ending November 2024, total construction starts were up 4% from the 12 months ending November 2023. Residential starts were up 7%, nonresidential starts were up 2%, and nonbuilding starts rose 4% over the same period. The number of manufacturing starts was down 52%.

"Construction starts continue to move sideways as the market waits for further rate cuts," Richard Branch, the chief economist of Dodge Construction Network, stated. "Elevated interest rates, labor shortages, and strict lending standards will continue to constrain construction activity in the near term."

The largest nonbuilding proj...

Dodge Momentum Index falls 2.3% in November

2024-12-06T13:01:00-05:00

The new Dodge Momentum Index (DMI) for the month of November decreased by 2.3% to a new score of 191.5 from the revised October reading of 196.0. Over the month, commercial planning was down 4.6% while institutional planning improved by 2.5%.

The November DMI is 12% higher than year-ago levels. The commercial segment was up 13% from November 2023, while the institutional segment was up 8% over the same period.

The DCN also shares: "The influence of data centers on the DMI this year has been substantial. If we remove all data center projects in 2023 and 2024, commercial planning would be down 6% from year-ago levels, and the entire DMI would be down 1%."

Sarah Martin, the associate director of forecasting at Dodge Construction Network, stated: "Throughout 2024, we’ve seen robust growth in nonresidential planning activity – but labor shortages and high construction costs have prevented those projects from moving through the planning process at a normal pace. The current backlog may...

Construction starts rise 4% in October, led by gains in nonresidential projects

2024-11-22T16:09:00-05:00

The total number of construction starts increased by 4% in October to a seasonally adjusted annual rate of $1.2 trillion, according to Dodge Construction Network’s latest Construction Starts Index. Nonresidential building starts rose 14%, nonbuilding starts grew by 2%, while residential building starts fell 3%.

On a year-to-date basis through October, total construction starts were up 3% from the same period in 2023. Residential starts were up 7%, nonresidential buildings rose 1%, and nonbuilding starts ticked up by less than one percent. For the 12 months ending October 2024, total construction starts were up 1% from the 12 months ending October 2023. Residential starts were up 6%, and nonresidential and nonbuilding starts were each down 1%.

“Construction starts have yet to see the impact of falling interest rates,” said Dodge Construction Network chief economist Richard Branch. “Several more rate cuts will be needed to start moving construction projects through the planning proce...

October's Dodge Momentum Index down 5.3% due to commercial sector losses

2024-11-07T15:36:00-05:00

The new Dodge Momentum Index (DMI) for the month of October has shown a decrease of 5.3% to a new score of 197.2. This is down from September’s revised reading of 208.2. Over the month, commercial planning fell 6.7%, and institutional planning declined 2.0%.

The declines were reflected in most commercial planning categories with hotels serving as the sole outlier. Education and public planning activity expanded the institutional side, which was offset slightly by weaker activity in healthcare, recreational, and religious projects. Overall, the DMI was 13% higher than in October of 2023.

"In addition to data center planning normalizing, a moderate pullback in the number of planning projects for several other nonresidential sectors also contributed to the decline in the Dodge Momentum Index for October," Sarah Martin, the associate director of forecasting at Dodge Construction Network, said. "Regardless, owners and developers remain confident in next year’s market conditions, and t...

Construction starts fall 6% in September, following two consecutive months of gains

2024-10-18T14:58:00-04:00

The total number of construction starts fell by 6% in September, resulting in a seasonally adjusted annual rate of $1.1 trillion, according to Dodge Construction Network’s latest Construction Starts Index. Nonbuilding starts fell 11%, residential starts decreased by 1%, and nonresidential building starts were down 6%.

On a year-to-date basis through September, total construction starts were up 2% from the same period in 2023. Residential starts were up 7%, nonresidential buildings rose 2%, and nonbuilding starts fell 3%. For the 12 months ending September 2024, total construction starts were up 1% from the 12 months ending September 2023. Residential starts were up 6%, nonresidential building starts were unchanged, and nonbuilding starts decreased by 4% on a 12-month rolling sum basis.

“Construction starts are treading water,” said Dodge Construction Network chief economist, Richard Branch. “September’s rate cut was just the first step in unwinding a period of high rates and severa...

September's Dodge Momentum Index drops 4% following three straight months of growth

2024-10-07T17:40:00-04:00

The latest Dodge Momentum Index (DMI) figures for September have shown decreases equal to a 4% drop to a new sore of 208.6 after a revised August reading of 217.7.

For the month, commercial planning contracted by 7.8% and institutional planning improved by 5.2%. The new DMI was 21% higher than in September of 2023. Planning in the commercial segment was up 31% from year-ago levels, while the institutional sector was up 4% over the same period.

"Despite this month’s decline, the Dodge Momentum Index remains at very robust levels," Sarah Martin, the associate director of forecasting at the Dodge Construction Network said in a statement. "A surge in data center activity drove much of the recent rapid growth in the DMI – so as planning for that sector moderated over the month, overall commercial planning fell back. By mid-2025, the Fed’s rate cuts should spur planning projects to reach groundbreaking more quickly – leading to stronger nonresidential activity as 2025 progresses."

The l...

Construction starts rise 6% in August, San Francisco International Airport T3 expansion leads with the highest project value

2024-09-24T14:19:00-04:00

The number of construction starts nationwide climbed 6% to a seasonally adjusted rate of $1.2 trillion in August, according to the latest data from the Dodge Construction Network (DCN). For the month, residential starts rose 5%, nonbuilding starts were up by 17%, and nonresidential buildings fell by 2%.

On a year-to-date basis through August, total construction starts were up 4% from the first eight months of 2023. Residential starts were up 8%, nonresidential buildings 3%. Total nonbuilding starts were down 1%. The total number of construction starts was up 2% from the 12 months ending August 2023. Residential starts were up 6% compared to the same year, while nonresidential building and nonbuilding starts each went up by 1% on a 12-month rolling sum basis.

"Construction starts continue to move forward at a modest pace," DCN chief economist Richard Branch said. "Now that the Federal Reserve has begun to lower rates the construction sector should begin to feel relief. The Dodge M...

Dodge Momentum Index continues to climb with 2.9% jump in August

2024-09-11T11:00:00-04:00

The Dodge Momentum Index (DMI) for August reports a 2.9% increase to a new score of 220.4 following July’s revised total of 214.2. Over the month, commercial planning expanded by 1.9%, and institutional planning was up another 5.7%.

"Owners and developers continued to prime the planning queue in August, ahead of next year’s anticipated stronger market conditions," Sarah Martin, the associate director of forecasting at Dodge Construction Network, said. "With the Fed’s September rate cut all but finalized, the influence of selective lending standards and inflation should moderate next year, alongside a modest upgrade to consumer demand. As a result, stronger planning activity was widespread in August, with most nonresidential sectors seeing growth."

The commercial planning sector was led again by data center and warehouse projects, while on the institutional side, healthcare projects continued to be a primary driver.

Related on Archinect: Architecture's Interest Rate Prayers Answer...

Construction starts rise 10% in July, propelled by gains in nonresidential building and infrastructure

2024-08-26T13:03:00-04:00

Construction starts have risen 10% for the month of July to a new seasonally-adjusted rate of $1.1 trillion, according to the latest data published by Dodge Construction Network (DCN). For the month, nonresidential buildings rose 25% and infrastructure starts were shown to increase by 19% as starts in the residential construction sector fell by 8%.

This reverses June’s 19% decline. On a year-to-date basis through the end of July, total construction starts were up 6% from the first seven months of 2023. Residential starts rose 11%, nonresidential buildings were up by 5%, and starts for nonbuildings remained flat.

For the 12 months ending July 2024, total construction starts were up 3% from the 12 months ending July 2023. Nonresidential building starts were down 1%, residential starts were up 7%, and nonbuilding starts were up 5% on a 12-month rolling sum basis.

“Construction starts show...

Dodge Momentum Index continues encouraging trajectory with 8% growth in July

2024-08-07T20:00:00-04:00

The Dodge Momentum Index (DMI) for July has improved for the second consecutive month, recording a 7.9% increase to a new score of 216.3. This follows June’s revised increase to 200.5. For the month, commercial planning grew by 6.8%, and institutional planning gained 11.1%.

"While data centers have had an outsized influence on nonresidential planning activity in recent months, more momentum is building across many other major sectors and diversifying the story behind July’s growth," Sarah Martin, Associate Director of Forecasting at Dodge Construction Network, commented. "The potential Fed rate cut in September is becoming increasingly more likely, alongside slower inflation and weaker labor market conditions. This is likely driving owners and developers to remain optimistic about 2025 market conditions and pushing more projects into the planning queue."

The acceleration of data centers nationwide continued to play an important role, as did healthcare facilities. The new DMI is 17% ...

Construction starts fall 19% in June, driven by stark decline in utility/gas activity

2024-07-24T15:01:00-04:00

The total number of construction starts fell by 19% in June, which resulted in a seasonally adjusted annual rate of $1.0 trillion, according to Dodge Construction Network’s latest Construction Starts Index.

Nonbuilding starts dipped 46%, and nonresidential starts decreased by 13%. Residential starts, on the other hand, rose 9%. On a year-to-date basis through June, total construction starts were up 7% from the same period in 2023. Residential starts were up 14%, nonbuilding starts gained 8%, and nonresidential building starts rose 1%.

June’s decline is attributed to a stark dip in utility/gas starts following a high level of activity in May, in which a Liquified Natural Gas plant and an offshore wind project got underway. As a result, gas/utility plants fell 90% over the month.

“The construction market remains sluggish as high interest rates continue to reverberate through the sector,” sa...

Dodge Momentum Index climbs 10% in June

2024-07-10T13:30:00-04:00

The Dodge Momentum Index (DMI) increased by 10.4% in June to a new score of 198.6, according to new data from Dodge Construction Network. The latest numbers are up considerably from the revised May reading of 179.9. Over the month, commercial planning increased 14.5%, and institutional planning ticked up 0.2%.

“Data centers continued to dominate planning projects in June — fueling another strong month for commercial planning,” stated Sarah Martin, Associate Director of Forecasting at Dodge Construction Network. “More momentum in planning, while not as strong as data centers, was seen across most segments and indicates confidence in 2025 market conditions. The DMI is up 43% from June 2019 levels, signaling strong construction spending in 2025.”

Data center planning continued to drive growth in the commercial sector. In the institutional sector, weak...

Construction Starts Index hits $1.24 trillion in May, propelled by 10% increase

2024-06-25T11:42:00-04:00

The total number of construction starts increased by 10% in May, according to data in Dodge Construction Network’s latest Construction Starts Index.

Nonbuilding starts increased by 49%, while residential starts fell 7% and nonresidential building starts went down 2%. On a year-to-date basis through the end of May, total construction starts were up 11% from the same period of 2023. Residential starts rose by 16%, while nonbuilding starts gained 17%, and nonresidential building starts went up by 3%.

The new seasonally adjusted annual rate was equal to $1.24 trillion.

“Even though May’s gain in construction starts was mainly due to a handful of large projects, the data highlights that there is some grassroots demand building in the market,” Richard Branch, Dodge Construction Network chief economist said in a statement. “Single-family starts, in particula...

Construction starts up 6% in April, led by substantial gains in manufacturing and institutional sectors

2024-05-28T13:36:00-04:00

The total number of construction starts in America rose 6% to a seasonally adjusted rate of $1.13 trillion for April, according to the latest data in Dodge Construction Network’s monthly reporting. For the month, nonresidential building starts gained 17%. The number of nonbuilding starts was 4% higher, while the residential starts fell by 1%.

The new Construction Starts Index report notes that, on a year-to-date basis, total construction starts were up 13% from the first four months of 2023. Residential starts were up 22%, while nonbuilding starts gained 14% and nonresidential building starts rose 5%.

“The rebound in starts in April was certainly good news for the sector,” Richard Branch, the chief economist of Dodge Construction Network, explained. “While the uncertain timing of Fed interest rates cuts is causing concern, developers and owners are feeling reasonably confident that end-market demand will sustain project starts in some sectors. While risk remains in the sector for ...

Dodge Momentum Index reverses decline in April, led by influx of commercial planning

2024-05-09T14:44:00-04:00

The latest Dodge Momentum Index (DMI) has shown an increase of 6.1% for April to a new score of 173.9. For the month, commercial planning improved by 12.6%, while institutional planning dropped by 6.3%.

Year-over-year, the DMI is now 1% lower than it was in April of 2023. Planning in the commercial segment was up 6% from year-ago levels, while the institutional segment was down 15% over the same timeframe. An influx of new data center projects had been credited for the marked improvements in the former category.

"Outsized demand to build Cloud and AI infrastructure is supporting above-average activity in the sector. Most other categories, however, faced slower growth over the month," Sarah Martin, the Associate Director of Forecasting at Dodge Construction Network, stated: "Across these industries, it’s likely that owners and developers are grappling with uncertainty around interest rates and lending standards, thus delaying their decisions to push projects into the planning queue....

Construction starts dip 1% in March despite encouraging signs in the residential sector

2024-04-26T13:56:00-04:00

Construction starts for March have dropped by 1% to a seasonally adjusted annual rate of $1.06 trillion, according to the latest figures released in Dodge Construction Network's new Construction Starts Index.

For the month, nonresidential building starts went down 9%, while nonbuilding starts dipped another 7%, and residential starts were up by 1%. On a year-to-date basis, the total number of all starts was up 13% compared to the same three-month period in 2023. Residential starts increased by 24%, while nonbuilding starts gained 16%, and nonresidential building starts went up by 2%.

“The construction sector has hit a soft patch to start 2024,” Richard Branch, the chief economist for Dodge Construction Network, said. “However, this should not be overly surprising given high rates and restrictive credit. There are bright spots though, as single-family starts are moving higher and federal dollars are lifting nonbuilding starts. The recent hot inflation readings likely mean that rate...

Dodge Momentum Index continues to decline in March due to office, hotel, and education planning slowdown

2024-04-08T12:46:00-04:00

The latest Dodge Momentum Index (DMI) information for March has shown a continued decrease in economic activity, dropping 8.6% to a new score of 164.0 from February's revised total of 179.5.

Over the month, commercial planning fell 3.2%, while institutional planning dropped 17.2%. The decline in commercial performance is attributed by Dodge Construction Network to slow growth in office and hotel planning, while the institutional sector decline is linked to a decline in education planning.

“While strong market fundamentals should support institutional planning this year, this side of the Index is more at risk for a substantive correction after last year’s growth,” explained Sarah Martin, associate director of forecasting for Dodge Construction Network. “Much of the decline on the institutional side is credited to lower levels of education planning. Between February 2023 and February 2024, life science and R&D laboratory projects account for roughly 34% of education planning value, wi...

Construction starts fall 8% in February, driven by sharp nonresidential decline

2024-03-21T18:46:00-04:00

The total value of construction starts for February fell by 8% to a seasonally adjusted annual rate of $1.07 trillion, according to the latest data from Dodge Construction Network.

For the month, nonresidential building starts dropped 16%, while nonbuilding starts were down 3%, and residential starts fell by 2%.

For the 12 months ending February 2024, total construction starts were up 2% from the 12 months ending February 2023. Nonresidential building starts were down 2%, while residential starts were 4% lower, and nonbuilding starts were up 19% on a 12-month rolling sum basis.

“Construction activity was hit hard by higher rates and more restrictive credit standards,” Richard Branch, the chief economist for Dodge Construction Network, said in a news release. “Starts struggled over the past several months as the lagged effect of higher rates impacted projects moving forward through the planning process. Additionally, the significant deficit of skilled labor led to further delays — e...

Dodge Momentum Index drops slightly for February, hampered by weak commercial planning

2024-03-07T17:12:00-05:00

The latest Dodge Momentum Index (DMI) information for February has shown a slight decrease in economic activity, dropping 1.4% to a new score of 180.5 from January’s revised total of 183.0.

Over the month, commercial planning fell 2.3% while institutional planning ticked up 0.1%. The drop in the commercial sector was caused primarily by a lag in new office planning. On the institutional side, slow healthcare and amusement planning was offset by a strong showing in the education sector to maintain a flat reading for the month.

“Weaker office and healthcare planning constrained nonresidential planning in February,” Sarah Martin, the associate director of forecasting for Dodge Construction Network, said in a press release. “However, the Index remains 25% higher than where it was just two years ago. Most other categories showed growth over the month, and Dodge remains optimistic that nonresidential planning will stay elevated throughout 2024 alongside rising confidence in 2025 market co...

Construction starts up another 1% in January, continuing winter improvements

2024-02-22T18:29:00-05:00

The latest construction starts statistics revealed by Dodge Construction Network for January report that the total number of starts grew 1% to a seasonally adjusted annual rate of $1.16 trillion.

Nonbuilding starts rose 9% during the month, while nonresidential building starts fell by 2% and residential starts remained flat. For the year ending in January 2024, total construction starts were down 1% from the previous 12 months. Nonresidential building starts were down 5%, while residential starts were 8% lower. Nonbuilding starts were also up 17% on a 12-month rolling basis.

“Construction starts are struggling to make headway in the new year,” Richard Branch, the chief economist for Dodge Construction Network, said in a news release. “Construction starts will continue to struggle early on in 2024 as higher interest rates and tight credit standards are slowing down projects moving through the planning cycle to start. The Federal Reserve is expected to cut rates later this year. That...

January's Dodge Momentum Index increases slightly thanks to gains in the institutional sector

2024-02-08T17:14:00-05:00

The latest Dodge Momentum Index (DMI) report has shown a slight increase of 0.1% for January to a new total of 184.1, indicating an improvement over December’s revised figure of 183.9.

Over the month, commercial planning fell by 1.0%, while institutional planning improved by 2.1%. Year over year, the DMI is now 3% lower than January 2023's totals. The commercial segment was down 12% from year-ago levels, while the institutional segment was up 15% over the same period.

"Divergent trends between commercial and institutional planning continued in January, nullifying any growth on the overall Momentum Index. Nevertheless, lending standards began to loosen in January, and the Fed is expected to begin cutting rates in the back half of the year. With this in mind, momentum should resume in commercial activity throughout 2024 as owners and developers gain confidence in market conditions for 2025," Sarah Martin, the associate director of forecasting for Dodge Construction Network, said in a...

Construction starts climb 20% in December

2024-01-19T16:46:00-05:00

The latest data from Dodge Construction Network has shown an impressive 20% growth in new construction starts to a seasonally adjusted annual rate of $1.2 trillion for the month of December, offering encouraging statistics for the industry in a turnaround from November’s ten-month low.

For the latest month, nonresidential building starts were up 37%, while the residential and nonbuilding sectors improved by 8% and 13%, respectively. For the full year ending in December, total construction starts were down 4% compared to the previous 12-month cycle.

Graphic courtesy of Dodge Construction Network

“Construction starts ended the year on a positive note,” Richard Branch, chief economist for Dodge Construction Network, said in a statement. “Looking ahead, the new year provides promise that positive momentum will continue to build. The planning queue is stabilizing, and the promise of lower rates should spur construction onward. While hurdles remain, including scarce labor and tight credit,...

December's Dodge Momentum Index increases by 3% thanks to commercial sector gains

2024-01-12T12:32:00-05:00

The latest Dodge Momentum Index (DMI) has posted an increase of 3% for December to a new total of 186.6, showing a marked improvement over November’s revised figure of 181.5.

For the month, commercial planning grew 1.0%, and institutional planning improved 6.1%. Hotels and data centers were the primary drivers of the sector, while the institutional sector was propelled by healthcare and public buildings. Overall, the commercial sector was down 9% from 2022, while the institutional sector was up 14% over the same time period.

“The Momentum Index ended the year 11% below the November 2022 peak, ultimately stabilizing as the year progressed. Regardless, the DMI averaged a reading of 184.3 in 2023, hitting levels of activity that haven’t been recorded since 2008,” Sarah Martin, the associate director of forecasting for Dodge Construction Network, said in a statement. “While ongoing labor and construction cost issues will persist in 2024, a substantive amount of projects are sitting in ...

Economic Pressures and Labor Challenges: How 2023 Shaped Architecture and Construction Industries

2023-12-28T07:49:00-05:00

The architecture industry was impacted this year by market volatility, rising interest rates, and evolving labor dynamics. This unusual business climate was reflected not only in the Architecture Billings Index (ABI) and the Dodge Momentum Index (DMI) but also in the pattern of job openings around the country, also observed through Archinect Jobs, the leading job board for the architecture industry in the USA.

AIA predicts slower growth in non-residential construction through 2023 and 2024

Hints of 2023's challenges began in late 2022, with a downturn in both the ABI and DMI to kick off 2023. This signaled a cautious approach by firm owners and clients alike amidst tightening credit conditions and rising interest rates. This recessed business landscape was quickly echoed in the job market, as seen by a substantial 51.9% decrease in job advertising volume in January 2023 compared to January 2022. This trend of reduced job postings continued throughout the year, with monthly declines r...

November construction starts drop 15% to new ten-month low

2023-12-20T14:00:00-05:00

Construction starts for the month of November fell by 15% to new ten-month lows at a seasonally adjusted annual rate of $927 billion, according to the latest figures from the Dodge Construction Network.

For the month, nonresidential building starts fell 29%, residential starts lost 6%, and nonbuilding starts dropped 2%. In terms of year-to-date figures through November 2023, total construction starts were down by 4% when compared to the same period last year. Residential and nonresidential starts were also down 14% and 7%, respectively, with nonbuilding starts recorded to be up by 19%.

“Construction starts are deeply feeling the impact of higher rates,” Richard Branch, the chief economist for the Dodge Construction Network, said in a statement. “While the Federal Reserve seems poised to start cutting rates in the New Year, the impact on starts will lag. As a result, starts are expected to be weak through the mid-point of 2024 before growth resumes.”

Graphic: Dodge Construction Net...

Dodge Momentum Index drops 1% for November, reversing October's gains

2023-12-07T13:06:00-05:00

The latest Dodge Momentum Index (DMI) for November has indicated a 1% drop to 179.2 a month after posting a revised total of 181.7 for October that was propelled by gains in the commercial sector.

Over November, both the commercial and institutional components fell by 1%. DCN says these results were driven largely by the weak performance of the educational segment, despite gains in healthcare and public spaces. Year over year, the index was 14% lower than in November 2022. The commercial segment was down 20% from November 2022 levels, and the institutional segment was up 2% over the same period.

“While both portions of the Momentum Index saw slower momentum in planning, overall levels remain steady and will support construction spending in 2024 and 2025,” stated Sarah Martin, associate director of forecasting for DCN. “Nonresidential planning activity will remain constrained from stronger growth amidst ongoing labor and construction cost challenges.”

Graphic: Dodge Construction Net...

Construction starts for October drop 7%, led by declines in the nonbuilding sector

2023-11-22T13:48:00-05:00

New data from the Dodge Construction Network has construction starts falling 7% in October to a seasonally adjusted annual rate of $1.1 trillion. The figures follow September’s 6% decline and represent another 4% year-to-year decline when compared to the same data sets from October 2022.

Nonbuilding and residential starts fell 32% and 1%, respectively. Nonresidential building starts gained 8% during the month.

Nonresidential starts were also up 8% year-to-date, an adjusted annual rate of $490 billion, though Dodge notes the sector would have fallen 28% if not for an abnormally strong spate of manufacturing plants. Residential starts represented another $385 billion. Nonbuilding starts fell to $231 billion year-to-date through October; however, nonbuilding starts were up by 20% overall.

Graphic courtesy of Dodge Construction Network

“Construction starts have weakened over the last two months as high interest rates and tight credit have restrained activity,” Richard Branch, the chief...

Dodge Momentum Index posts 1% increase for October, driven by commercial sector gains

2023-11-07T18:06:00-05:00

The data just released in the Dodge Momentum Index (DMI) reporting for the month of October indicate a 1.0% increase to 181.7 over September’s revised total of 180.3.

The increase was propelled by a 2.0% rise in the commercial component, while the institutional component dropped by 1.4%. Year over year, the DMI came in 8% lower than in October of 2022. The commercial segment was down by 14%, while the institutional segment was up by 7%.

“Heightened momentum in warehouse planning activity supported the commercial side of the Index this month, while muted education planning activity slowed the institutional portion,” Sarah Martin, the Associate Director of Forecasting for Dodge Construction Network, said in a statement. “Overall levels of planning activity remain robust and will support construction spending over the next 12 to 18 months.”

Graphic: Dodge Construction Network

A total of 21 projects valued at $100 million or more entered planning in the month. The largest commercial ...

Boost in institutional planning drives 3% Dodge Momentum Index rise in September

2023-10-06T18:11:00-04:00

September's Dodge Momentum Index (DMI) rose 3% to 182.5 from the revised August reading of 178.0. Over the month, the DMI’s commercial component fell 1%, while the institutional component rose 9%.

The dip in the commercial segment was driven by weaker office planning. On the other hand, the institutional segment was spurred by stronger education, notably life science buildings, and healthcare planning activity. Year over year, the DMI was 5% lower last month than in September 2022. The commercial sector was 12% below last year’s September levels, while the institutional sector was up 12% over the same time period.

“Solid demand for data centers, life science labs, and hospitals supported the uptick in nonresidential planning activity last month,” said Associate Director of Forecasting for Dodge Construction Network, Sarah Martin. “While month-to-month trends can be volatile, year-to-date trends show an overall decrease in commercial planning, offset by more institutional projects en...

Construction starts for August rise 6% with huge gains in the manufacturing sector

2023-09-20T14:42:00-04:00

The latest data from the Dodge Construction Network has indicated a 6% total rise in construction starts to a seasonally-adjusted rate of $1.3 trillion for the month of August, following a 17% rise that was recorded in July thanks to gains in the multifamily and nonbuilding sectors.

Nonresidential starts for the month rose by 40% thanks to a 285% increase in the manufacturing sector. Residential and nonbuilding starts both fell by 1% and 14%, respectively, while starts in the commercial and nonresidential building sectors both rose by 8% and 24% each.

“Despite the August gain, the construction sector is running uphill,” Dodge Construction Network chief economist Richard Branch said. “Fear of an imminent recession seems to have abated, which should provide a boost of confidence to the sector. However, higher interest rates, labor shortages and significantly tighter lending standards will weigh down starts in the final quarter of the year. This will persist for the foreseeable future...