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Single family, infrastructure, and airline terminal work propels starts

BEDFORD, MA —September 24, 2024 — Total construction starts rose 6% in August to a seasonally adjust annual rate of $1.2 trillion, according to Dodge Construction Network. Residential starts rose 5%, nonbuilding starts gained 17%, while nonresidential buildings fell 2% in August. 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 rose 3%, and nonbuilding starts were down 1%.  

For the 12 months ending August 2024, total construction starts were up 2% from the 12 months ending August 2023. Residential starts were up 6%, while nonresidential building and nonbuilding starts were each up 1% on a 12-month rolling sum basis.  

“Construction starts continue to move forward at a modest pace,” said Richard Branch, chief economist of Dodge Construction Network. “Now that the Federal Reserve has begun to lower rates the construction sector should begin to feel relief. The Dodge Momentum Index has been steady, indicating that owners and developers feel reasonably confident that market and financial conditions will improve. Improve they will, but it will take successive rate cuts before they feel comfortable moving these projects forward to start. Starts should show stronger and more consistent growth in the first quarter of 2025.” 

Nonbuilding

Nonbuilding construction starts climbed 17% from July to August to a seasonally adjusted annual rate of $348 billion. Much of the gain was driven by a 57% increase in utility/gas starts. Environmental public starts rose 19%, miscellaneous nonbuilding starts were up 11%, and highway and bridge starts posted a modest 1% gain. On a year-to-date basis through August total nonbuilding starts were down 1% from a year ago. Miscellaneous nonbuilding starts were up 9%, environmental public works starts were 8% higher, highway and bridge starts improved by 2%, but utility/gas starts were down 17% through August.  

For the 12 months ending August 2024, total nonbuilding starts were 1% higher than the 12 months ending August 2023. Miscellaneous nonbuilding starts were 5% higher, environmental public works gained 3%, highway and bridge starts increased by 1%, but utility/gas starts were down 5%.   

The largest nonbuilding projects to break ground in August were the $861 million South Brooklyn Marine Terminal for offshore wind production in Sunset Park, New York, the $813 million second phase of the Bellefield Solar farm in California City, California, and a $631 million paving project in Honolulu, Hawaii.  

Nonresidential 

Nonresidential building starts fell 2% in August to a seasonally adjusted annual rate of $437 billion. Commercial starts lost 32% and manufacturing starts dropped 21%. These declines were almost offset by a 32% gain in institutional starts driven by education and airline terminals. On a year-to-date basis through August, total nonresidential starts were up 3%. Institutional starts were 13% higher, while commercial starts were flat, and manufacturing starts were 16% lower on a year-to-date basis through August. 

For the 12 months ending August 2024, nonresidential building starts were 1% higher than the previous 12 months. Manufacturing starts were down 16%, commercial starts were down 7%, and institutional starts were 14% higher for the 12 months ending August 2024.

The largest nonresidential building projects to break ground in August were the $2.9 billion terminal 3 modernization at San Franciso International Airport in San Francisco, CA, the $1.3 billion Marshall County EV plant (a partnership between Cummins’ EV division, Daimler, and PACCAR) in Byhalia, Mississippi, and the $900 million Geisinger Wyoming Valley Hospital in Wilkes-Barre, Pennsylvania.  

Residential 

Residential building starts improved 5% in August to a seasonally adjusted annual rate of $383 billion. Single family starts rose 7%, while multifamily starts were 1% higher. On a year-to-date basis through eight months, total residential starts were 8% higher. Single family starts jumped 19% and multifamily starts were down 10% on a year-to-date basis.  

For the 12 months ending August 2024, residential starts were 6% higher than the previous 12 months. Single family starts were 17% higher, while multifamily starts were 11% lower on a 12-month rolling sum basis.

The largest multifamily structures to break ground in August were the $332 million West Brighton I & II Apartments in Richmond County, New York, the $235 million Cooper Park Commons in East Williamsburg, New York, and the $248 million The Downs mixed-use building in Northville, Michigan.  

Regionally, total construction starts in August rose in the Northeast, West and South Central regions, but fell in the Midwest and South Atlantic.

The post Construction Starts Increase 6% in August appeared first on Dodge Construction Network.

Source: New feed