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Cooling nonbuilding activity leads to a broader slowdown

BOSTON, MA — March 20, 2026 — Total construction starts declined 13.2% in February to a seasonally adjusted annual rate of $1.08 trillion, according to Dodge Construction Network. Nonresidential building starts rebounded by 17.8%, residential starts improved 8.3%, and nonbuilding starts declined 49.4% over the month. On a year-to-date basis, total construction starts were down 1.9% through February. Nonresidential starts were down 2.0%, residential starts were down 12.4% and nonbuilding starts improved by 9.9% over the same period. For the 12 months ending February 2026, total construction starts were up 5.2% from the 12 months ending February 2025. Residential starts were down 6.3%, nonresidential starts were up 6.1% and nonbuilding was up 17.0%.   

“After a weak start to the year, nonresidential and residential building starts steadily rebounded throughout February,” stated Sarah Martin, Associate Director of Forecast at Dodge Construction Network. “Conversely, nonbuilding activity slowed down last month – normalizing from elevated levels in January.” 

Residential 

Residential building starts grew by 8.3% in February to a seasonally adjusted annual rate of $374 billion. Single family starts increased 4.0% m/m, and multifamily starts expanded by 15.9% m/m. On a year-to-date basis, residential starts are down 12.4%, with single family starts down 17.5% and multifamily starts down 2.8%. 

For the 12 months ending February 2026, total residential starts fell 6.3%. Single family starts fell 16.2% compared to the 12 months ending February 2025, and multifamily starts increased 14.9% over the same period.  

The largest multifamily structures to break ground in February were the $757 million Bay View Houses Renovation project in Canarsie, New York, the $311 million Universal Building North and $265 million Universal Building South within the Geneva Residential Conversion project in Washington, D.C.  

Nonresidential 

Nonresidential building starts improved 17.8% in February to a seasonally adjusted annual rate of $442 billion. Commercial starts were up 48.5%, solely driven by the 159.6% m/m growth in offices and data centers. Meanwhile, stores (-4.7% m/m), parking garages (-23.1% m/m), hotels (-7.9% m/m) and warehouses (-12.1% m/m) all lost pace throughout February. Institutional starts also expanded 8.7% over the month, alongside steady growth in education (+19.6% m/m) and the remaining institutional categories (+56.4%). Healthcare construction continued to pullback, dropping 46.6% m/m. After a strong January, manufacturing construction also slowed down, pulling back 54.1% m/m. On a year-to-date basis through February, nonresidential starts are down 2.0%. Commercial and industrial construction is up 22.9%, while institutional starts are down 22.7% over the same period.  

For the 12 months ending February 2026, total nonresidential starts were up 6.1% compared to the 12 months ending February 2025. Commercial starts were up 20.2%, institutional starts decreased 5.6%, and manufacturing starts were up 12.9% over the same period.  

The largest nonresidential building projects to break ground in February were the $3 billion Google Data Center Campus (Project Meitner) in Miami, Texas, the $3 billion Polaris Forge 2 AI Data Center in Harwood, North Dakota, and the $1.53 billion Tampa International Airport Airside D project in Tampa, Florida.  

Nonbuilding

Nonbuilding construction starts decelerated 49.4% in February to a seasonally adjusted annual rate of $265 billion. After nearly 200% growth in January, electric power/utilities construction normalized in February and dropped 90.1% m/m. Miscellaneous nonbuilding declined as well, falling back 12.3% over the month. Conversely, highways and bridges (+18.8% m/m) and environmental public works (+4.8% m/m) saw improvements. On a year-to-date basis through February, nonbuilding construction was up 9.9% alongside the 133.8% year-to-date growth in electric power/utilities. The remaining public works sectors, however, are seeing deeper year-to-date declines.  

For the 12 months ending February 2026, total nonbuilding starts were up 17.0%. Environmental public works fell by 6.4% compared to the 12 months ending February 2025. Highway and bridge starts were down 0.2%, miscellaneous nonbuilding starts were up 32.9% and utility/gas starts increased 59.3% over the same period.  

The largest nonbuilding projects to break ground in February included the $564 million SR 400 (I-4) highway development in Celebration, Florida, the $389 million 1-94 reconstruction project in Romulus, Michigan and the $386 million Allegheny County Wet Weather Pump Station in Pittsburgh, Pennsylvania.  

Regionally, total construction starts in February rose in the Midwest (+41.0% m/m) and the West (+4.2% m/m). Meanwhile, starts receded in the Northeast (-38.1% m/m), the South Atlantic (-4.9% m/m) and the South Central (-37.7% m/m).  

The post Construction Starts Slow by 13% in February appeared first on Dodge Construction Network.

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