Dive Brief:
- The November Dodge Momentum Index edged up 0.3% to 133.2 — up from a downward-revised October reading of 132.7 — making it the 10th gain in the last 12 months, according to Dodge Data & Analytics.
- Commercial planning and its 4.1% increase counterbalanced institutional's drop of 5.2%. Despite a strong showing earlier this year, the institutional sector has fallen 2% compared to November of last year, while commercial is up 35% year over year.
- Dodge said the Momentum Index is now 18% higher than it was in November 2015, which means that 2017 should bring robust construction activity, even though the fluctuations seen in 2016 are likely to continue.
Dive Insight:
The Momentum Index is a monthly measure of initial reports of nonresidential construction projects in the planning stages, which typically lead nonresidential construction spending by one year.
Dodge reported that seven institutional and commercial projects — down from last month’s 12 — valued at more than $100 million entered the planning stages in November. These included a $400 million office building in Chicago; a $180 million hotel renovation in New York City; a $150 million hospital in Rochester, NY; and a $100 million hospital research lab in Bethesda, MD.
The latest American Institute of Architects is due out later this month, but November’s release saw the Architecture Billings Index snap back to a figure above 50 — 50.8 — for October after two months below the benchmark. That was the first time in more than four years the Index came in below 50 for two months in a row. The ABI is considered an indicator of future construction spending nine to 12 months in advance, and any reading below 50 indicates reduced demand for design services, which could lead to less construction activity down the road.
