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Dodge Momentum Index Dips in September
October 5, 2012 - New York, NY
The Dodge Momentum Index retreated 0.8% in September compared to August, according to McGraw-Hill Construction, a division of The McGraw-Hill Companies. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The September Momentum Index came in at 94.7 (2000=100), down from a revised 95.4 in August and 96.7 in July. While the longer term trend is still viewed as positive, the Index appears to be experiencing a temporary pause. Uncertainty, particularly related to the impending presidential election and yearend expiration of the Bush tax cuts combined with automatic spending cuts (the "fiscal cliff"), is likely the main contributor to this short-term hesitation in future development plans.
The uncertainty seems to be weighing more heavily on the commercial segment of the Index, which dropped by 5.4% in September. Institutional building, by comparison, rose by 4.0%. A decline in the volume of education projects was offset by the inclusion of two large healthcare developments: the $300 million Children’s Hospital proposed in San Antonio TX and the $200 million Froedtert Hospital slated in Milwaukee WI. The decline for the commercial segment of the Index was cushioned by two $100 million office campuses—one in Midland TX and one in Wesley Chapel FL—that entered planning in September.
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McGraw-Hill announced on September 12, 2011, its intention to separate into two public companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial's leading brands include Standard & Poor's Ratings Services, S&P Capital IQ, S&P Indices, Platts energy information services and J.D. Power and Associates. With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at: http://www.mcgraw-hill.com/.
Kathy Malangone, Senior Director, Marketing Communications,
McGraw-Hill Construction, +1 212-904-4376, Kathy Malangone