Properties Magazine February 2017 : Page 10

New Construction Starts in December Slide 5% Naturally Provided by Dodge Data & Analytics ew construction starts in December slipped 5% to a seasonally adjusted annual rate of $613.0 billion, according to Dodge Data & Analytics. The latest month’s decline for total con-struction was due to sharply reduced activity for the nonbuilding construction sector, reflecting further erosion by public works as well as a steep plunge by the electric utility/gas plant category. At the same time, nonresidential building in December held steady with its November pace, and residential building was able to register moderate growth. N For all of 2016, total construction starts advanced 1% to $676.5 billion, a considerably smaller gain than the 11% increase reported for 2015. If the volatile manufacturing plant and electric utility/ gas plant categories are excluded, total construction starts in 2016 would be up 4%, depicting a more gradual decel-eration relative to the corresponding 9% increase in 2015. The December statistics produced a reading of 130 for the Dodge Index (2000=100), down from a revised 136 for November. For the full year 2016, the Dodge Index averaged 143. “The construction start statistics over the course of 2016 revealed a varied pat-tern, with the end result being a slight gain for the year as a whole,” says Robert A. Murray, chief economist for Dodge Data & Analytics. “On a quarterly basis, growth was reported during the first and third quarters, while activity settled back during the second and fourth quarters. On the plus side for 2016, commercial building continued to rise, and institu-tional building provided evidence that it “In a broad sense, construction activity shifted to a more mature stage of expansion in 2016, characterized by a slower rate of growth for total construction compared to the 10% to 12% gains of the previous four years.” Robert A. Murray Dodge Data & Analytics was beginning to regain upward momen-tum after pausing in 2015.” Single-family housing showed mod-erate improvement, while multifamily housing witnessed growth in numerous markets with the notable exception of Precision Laser www.laserinst.com & Instrument, Inc. . Construction Sales Shop Online! Survey Training GIS Support Service Rentals Build Construction Solutions New Kenai Tablet w/ 10.1 Inch Screen! Robert Fancher | Build Construction Solutions 2I¿FH&#1d;
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_&HOO&#1d;&#1b;&#1b;_5-)#ODVHULQVWFRP New York, New York, which retreated after the robust activity reported in 2015, Murray says. On the nega-tive side, public works settled back in 2016, and steep declines were reported for manufacturing plants and the gas plant portion of the elec-tric utility/gas plant category. “In a broad sense, construction activity shifted to a more mature stage of expansion in 2016, characterized by a slower rate of growth for total construction compared to the 10% to 12% gains of the previous four years,” Murray says. “For 2017, more growth at a moderate pace is expected for total construction. Commercial build-ing has yet to see much in the way of rising vacancy rates, and the insti-tutional building sector will be helped by the passage of such recent bond measures as the $9 billion Proposition 51 in California. “Manufacturing plant construction should turn upward, no longer exerting a downward pull on overall construction activity. Despite rising mortgage rates, housing should benefit from greater demand coming from an increasing number of millennials moving into their thirties. And, public works will be sup-ported by recent bond measures passed at the state level, although Congress will need to revisit the flat federal funding for highways under the current continu-ing resolution that expires at the end of April. Additional support for public works will depend on how Congress responds to the proposals by the Trump Administration for more infrastructure spending, including incentives to spur private investment.” Nonresidential building Design Build Operate Nonresidential building in December was reported at $224.0 billion (annual rate), basically unchanged from Properties | February 2017 10

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