Healthy growth in building construction offsets infrastructure weakness
HAMILTON, NJ — May 17, 2022 — Total construction starts rose 3% in April to a seasonally adjusted annual rate of $945.8 billion, according to Dodge Construction Network. Nonresidential building starts rose 6% and residential starts increased by 4%, while nonbuilding starts fell 4%.
Year-to-date, total construction was 6% higher in the first four months of 2022 compared to the same period of 2021. Nonresidential building starts rose 19%, residential starts gained 3%, while nonbuilding starts were 2% lower. For the 12 months ending April 2022, total construction starts were 12% above the 12 months ending April 2021. Nonresidential starts were 24% higher, residential starts gained 11% and nonbuilding starts were down 1%.
“The construction sector is seemingly shrugging off the fear of higher interest rates and a potential recession,” said Richard Branch, chief economist for Dodge Construction Network. “Many building sectors have made the turn from weakness to recovery as underlying economic growth and hiring are solid. With the pipeline of projects in planning continuing to expand, this trend should continue in the months to come. However, the concern that the Federal Reserve will force the U.S. into recession later this year may thwart the momentum in construction starts. While recession is not our baseline forecast, it can not be fully discounted.”
Below is the breakdown for construction starts:
For the 12 months ending April 2022, total nonbuilding starts were 1% lower than in the 12 months ending April 2021. Environmental public works starts were up 10%, and street/bridge starts gained 6%. Miscellaneous nonbuilding starts were 33% lower and utility/gas plant starts were down 3%.
The largest nonbuilding projects to break ground in April were the $531 million Gross Reservoir Expansion in Golden, CO, the $450 million Seven Cowboy wind project in Washita and Kiowa counties, OK, and the $338 million Great Pathfinder wind farm in Boone and Hamilton counties, IA.
For the 12 months ending April 2022, nonresidential building starts were 24% higher than in the 12 months ending April 2021. Commercial starts grew 19%, institutional starts rose 11%, and manufacturing starts swelled 163% on a 12-month rolling sum basis.
The largest nonresidential building projects to break ground in April were the $500 million Caesar Virginia hotel and casino in Danville, VA, the $430 million Aggie Square Life science building in Sacramento, CA, and the $400 million The Rose Gaming Resort in Dumfries, VA.
For the 12 months ending April 2022, residential starts improved 11% from the same period ending March 2021. Single family starts were 6% higher and multifamily starts were 27% stronger on a 12-month rolling sum basis.
The largest multifamily structures to break ground in April were the $420 million 2-10 54th Avenue apartments in Long Island City, NY, the $400 million Civic Square condominiums in Seattle, WA, and a $300 million mixed-use building in Long Island City, NY.
Regionally, total construction starts in April rose in the Northeast, South Atlantic, and South Central regions, but fell in the Midwest and West.
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Cailey Henderson | 104 West Partners | email@example.com
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