July saw an uptick in planned nonresidential building projects, despite concerns about rising interest rates and a sluggish economy.
The Dodge Momentum Index reported a 2.9% increase over June to 178.7. The index is shown to lead construction spending for nonresidential buildings by a full year.
“The Momentum Index has yet to show signs of stress as recession fears mount. This shows that developers and owners remain confident that nonresidential building projects will weather the storm of higher interest rates and a slowing economy,” said Richard Branch, chief economist for Dodge Construction Network. “Whether this can be sustained over the medium term remains a key question that will ultimately dictate the pattern for construction starts in 2023.”
Data center, office and warehouse projects drove a 5.5% increase in the index’s commercial planning component, while fewer education and healthcare projects drove the institutional component lower, Dodge says.
When compared to July 2021, last month’s overall index increased 8%, with commercial up 15% and institutional down 3%.
A total of 14 projects with a value of $100 million or more entered planning in July.
Top commercial projects included:
- $300 million Schnitzer Industrial Park in Sacramento, CA
- $275 million Parteere 42 mixed-use complex in Miami,
- $180 million Edgecore Data Center in Sterling, VA.
Top institutional projects included:
- $500 million Vanderbilt University Medical Center in Nashville, TN,
- $157 million life sciences building in San Francisco
- $150 million Cal Poly Humboldt Craftman’s student housing project in Arcata, CA