Dive Brief:
- Driven by a 4.5% drop in the institutional sector and a 5% drop in commercial, the Dodge Momentum Index fell 4.8% in October, almost completely reversing September’s 5.8% gain, which was fueled by a rise in planned institutional building projects.
- In October, planning for institutional building projects dropped 4.5% after surging 10.6% in September, while commercial building projects retreated 5.0% after September’s 1.7% gain.
- Although both industrial and commercial performed poorly compared to their respective September gains of 10.6% and 1.7%, compared to the same month a year ago, the Momentum Index in October was still up 4.8%, with increases for both the commercial (6.3%) and institutional (2.6%) sectors.
Dive Insight:
The institutional building sector has been volatile month-to-month but positive so far in 2015, which was the same trend when the industry was first making a recovery in the 2000s — a good sign for continued recovery.
The Momentum Index is a monthly measure of initial reports of nonresidential building projects in planning, which usually lead nonresidential construction spending by one year.
According to Dodge, eight projects exceeding $100 million entered their first phases in October, with the commercial sector taking a little more than half of those.
Among the institutional projects entering planning in October were a $350 million hospital in Washington, DC, and a $110 million hospital in Bethesda, MD. Entering the planning stage in the commercial sector were a $500 million mixed-use facility at the Mall of America in Minneapolis, MN, and a $151 million warehouse and distribution complex in Newark, NJ.
