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Dodge Reports New Construction Starts Recede in February
New construction starts in February slipped 3% from the previous month to a seasonally adjusted annual rate of $708.1 billion, according to Dodge Data & Analytics. The reduced activity last month followed a 2% decline in January, as the early months of 2018 are showing some loss of momentum after the 12% increase reported in December.
The nonbuilding construction sector (public works and electric utilities/gas plants), fell 23% in February, resulting in the decline for total construction starts. In contrast, nonresidential building grew 5% in February, continuing the strengthening trend which resumed in December, and residential building improved a slight 1%.
Dodge Data & Analytics’ chief economist Robert Murray says, “Compared to last year’s fourth quarter, the first two months of 2018 have seen further increases for nonresidential building, helped by its institutional building segment, and residential building, helped by multifamily housing. This suggests that the construction expansion, while slowing, is still in progress.”
Key Dodge report findings:
– Total construction starts totaled $102.4 billion in first two months of 2018, down 7% from the same period a year ago
– February nonresidential building was $246.7 billion (annual rate), up 5% from January
– Commercial categories as a group rose 14%, with gains across most of the property types
– Office construction advanced 24% after a subdued January
– Hotel construction jumped 60% in February
– Multifamily increased 7%, reflecting the start of 11 projects valued each at $100 million or more
– Warehouse construction in February was the one commercial property type to decline, sliding 36%
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