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December 2009 contracts increase 5 percent

McGraw-Hill Construction, a division of The McGraw-Hill Cos., New York, has reported construction starts increased 5 percent in December 2009. During 2009, total construction was down 26 percent compared with a 13 percent decline in 2008.

"The construction industry went through a particularly tough year in 2009 as the 26 percent annual decline for construction starts was the steepest in at least the past 40 years," says Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction. "At the same time, the bottom for construction starts was reached in February, to be followed by an up-and-down pattern during 2009 that suggests the transition has been made from steady decline to at least low-level stability. Single-family housing, though still remaining at a low volume, began to show some improvement as 2009 progressed. Funding from the federal stimulus bill helped to produce gains for highways and bridges, as well as a pickup for a few project types, such as courthouses.

"However, commercial building and multifamily housing registered particularly severe declines in 2009, and even the previously resilient institutional building sector lost momentum," he continues. "Going into 2010, more improvement is expected for housing and public works, but commercial and institutional building will continue to be adversely affected by weak employment, tight bank lending, and the eroding fiscal health of states and localities."

Nonresidential building construction was unchanged in December 2009. In the commercial category, manufacturing plant construction jumped 143 percent; store construction surged 52 percent; warehouse construction increased 15 percent; office construction dropped 15 percent; and hotel construction fell 32 percent. In the institutional category, amusement-related construction rose 56 percent; health care facility construction climbed 8 percent; churches increased 3 percent; educational buildings fell 3 percent; transportation terminals dropped 14 percent; and public buildings decreased 60 percent.

Residential building construction rose 1 percent in December 2009. Single-family housing increased 2 percent, and multifamily construction climbed 1 percent.

Nonbuilding construction increased 15 percent in December 2009.

During 2009, nonresidential building decreased 33 percent compared with 2008. Residential building was down 31 percent, and nonbuilding construction decreased 9 percent. By geographic region, the Northeast dropped 24 percent; South Central fell 25 percent; Midwest decreased 26 percent; South Atlantic dropped 27 percent; and West declined 27 percent.

1/25/2010  

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