Dodge Data & Analytics, New York, has reported construction starts decreased 3 percent in February. Total construction starts in February were unchanged compared with February 2018.
"The pace of construction starts has been lackluster in early 2019," says Robert A. Murray, chief economist for Dodge Data & Analytics. "The public works sector has retreated, likely affected by harsh winter weather conditions and the fact that fiscal 2019 federal appropriations for several programs were not finalized until mid-February. With funding levels now set, including a 2 percent increase for the federal-aid highway program, it's expected that public works will show improvement in coming months.
"For residential building, single-family housing remains sluggish, as affordability constraints continue to dampen demand even as mortgage rates have settled back, while a more cautious lending stance by banks may now be starting to restrain multifamily development," he continues. "Nonresidential building so far in 2019 has not yet seen the same magnitude of very large projects that reached groundbreaking during 2018. At the same time, market fundamentals for warehouses and office buildings remain supportive for construction, and the large amount of funding coming from state bond measures passed in recent years should contribute to healthy levels of construction activity for such institutional project types as school construction."
Nonresidential building construction was unchanged in February. In the commercial category, warehouse construction grew 33 percent; hotel construction rose 22 percent; store construction climbed 11 percent; and office construction fell 21 percent. In the institutional category, health care facility construction rose 26 percent; educational building construction increased 6 percent; amusement-related construction decreased 7 percent; manufacturing plant construction dropped 14 percent; churches fell 23 percent; transportation terminal construction declined 35 percent; and public buildings plunged 45 percent.
Residential building construction fell 3 percent in February. Single-family housing dropped 2 percent, and multifamily construction fell 7 percent.
Nonbuilding construction fell 8 percent in February.
During the first two months of 2019, nonresidential building was down 13 percent compared with the same time period in 2018. Residential building decreased 15 percent, and nonbuilding construction dropped 6 percent. By geographic region, the West declined 8 percent; South Atlantic fell 9 percent; South Central decreased 10 percent; Northeast dropped 15 percent; and Midwest declined 24 percent.
