Starts jump in June, Reed says; several reports point to growth in diverse segments
Prepared by: AGC of America
The value of nonresidential construction starts in June jumped 14% compared with June 2013, Reed Construction Data reported today, based on data it collected. Cumulative starts for the first half of 2014 exceeded January-June 2013 starts by 2.4%. Nonresidential building starts slipped 3.1% year-to-date, with a 14.5% drop in commercial starts offsetting gains of 5.9% for institutional buildings and 13.5% for industrial (manufacturing). Heavy engineering starts rose13% year-to-date.
The Dodge Momentum Index “gained 3.3% in June, its third consecutive increase following hesitation in February and March,” McGraw Hill Construction reported on Wednesday. The index is “a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The Dodge Momentum Index appears to be recovering from the weather-induced softness early in the year. Aided by this recent strengthening, the Momentum Index was a healthy 22.6% higher in June than a year earlier. Moreover, the growing volume of projects at the planning stage suggests that nonresidential construction starts should be headed higher over the remainder of the year. This month’s increase in the Momentum Index was the result of a strong 8.3% surge in commercial building plans. At the same time, the institutional side of the market retreated in June, with new projects at the planning stage slipping 4.0%.”