Home > News > Industry News > April construction advances 9 percent

April construction advances 9 percent

Post Time:Nov 12,2013Classify:Industry NewsView:50

The value of new construction starts in April climbed 9 percent to a seasonally adjusted annual rate of $553.5 billion, according to McGraw-Hill Construction, a division of The McGraw-Hill Cos. Much of the increase came as the result of a strong performance by nonbuilding construction, which comprises public works and electric utilities. Nonresidential building showed moderate improvement in April, while residential building stayed unchanged from its March pace. For the first four months of 2008, total construction on an unadjusted basis came in at $170.4 billion, down 17 percent from the same period a year ago. Excluding residential building, new construction starts in the first four months of 2008 rose 3 percent. April’s data produced a reading of 117 for the Dodge Index, up from a revised 108 for March, and equal to the average for January and February. "While housing is still in the process of reaching bottom, and tighter lending standards are raising concern about the prospects for commercial building, publicly financed construction is expected to hold up relatively well during 2008," stated Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction. "The strength shown by the public works categories in April, along with the elevated activity for several institutional structure types, supports this belief." Nonbuilding construction in April jumped 28 percent to $162.4 billion, annual rate, reflecting gains for both public works, up 24 percent, and electric utilities, up 41 percent. Of the public works categories, the largest increase was reported for water supply systems, up 167 percent. The boost to the water supply category was provided by the start of a massive $1.3 billion water treatment plant in Westchester County, New York, as well as by $115 million for reconstruction of a water treatment plant in Phoenix. The water resources category also witnessed substantial growth, rising 74 percent with the push coming from $200 million for a reservoir project in West Palm Beach, Fla., and $57 million for harbor dredging in Boston. After a very strong March, sewer construction in April edged up an additional 2 percent, helped by the start of a $278 million water pollution control Two Penn Plaza, 9th Floor, New York, NY 10121-2298 project in Brooklyn N.Y. April also saw a 21 percent rebound for bridge construction, while "miscellaneous" public works rose 20 percent, lifted by the start of a $378 million light rail project in Denver and a $100 million oil pipeline in Minnesota. Running counter to April’s broad upward trend for public works was highway construction, which slipped 8 percent. The boost provided to the April nonbuilding total by electric utilities came mostly from the start of one project: a $2.9 billion coal-fired power plant in Illinois. Nonresidential building in April grew 5 percent to $210.6 billion, annual rate, after dropping 25 percent in March. Healthcare facilities had a particularly strong April, jumping 41 percent, as five large hospitals reached groundbreaking in the following states: New York, $195 million; Tennessee, $188 million; Indiana, $185 million; Maryland, $150 million; and Washington, $142 million. Substantial gains were also registered by two of the smaller institutional structure types. The amusement category soared 82 percent, aided by the start of a $400 million convention center expansion in Philadelphia, plus the start of several large theater and performing arts facilities in California, Florida, and Washington D.C. Transportation terminal work climbed 52 percent, led by a $126 million terminal renovation at Miami International Airport and a $90 million terminal expansion at Washington Dulles International Airport. Church construction also helped out, climbing 10 percent in April. On the negative side, the public buildings category, detention facilities and courthouses, fell 25 percent after an exceptional March. And, educational buildings, the largest nonresidential category by dollar volume, settled back 10 percent in April after heightened contracting in March. The commercial structure types generally showed modest weakening in April. Office construction eased back 1 percent, although April did include the start of four sizeable projects, located in Washington D.C., $210 million and $101 million; Atlanta, $175 million; and New York, $100 million. Hotel construction in April dropped 5 percent, sliding for the second month in a row after the robust volume reported at the outset of 2008. Store construction in April fell 8 percent, and Murray noted that "the store category in particular is vulnerable this year, as retailers pull back on expansion in the face of tighter credit conditions and weaker consumer spending." Warehouse construction in April edged up 1 percent, yet its pace so far in 2008 lags behind last year. Manufacturing plant construction in April climbed 63 percent after a very weak March, as two large ethanol plants reached groundbreaking, located in North Carolina, $100 million, and Indiana, $80 million. Residential building, at $180.5 billion, annual rate, in April, was essentially unchanged from March. Single family housing continued to lose momentum, slipping 1 percent. Although the decline was relatively small, it did extend the downward trend that has been underway for over two years now. By major region, single family housing in April showed further reductions in the South Atlantic, down 6 percent; the West, down 2 percent; and the South Central, down 1 percent; while modest improvement was reported in the Northeast, up 3 percent; and the Midwest, up 4 percent. Multifamily housing in April increased 3 percent, helped by the start of four large projects in Chicago, $132 million; Washington, D.C., $107 million; Port Washington, N.Y., $101 million; and Atlanta, $100 million. "There is still the occasional month that includes large multifamily projects, like April, but the number of such projects reaching groundbreaking has become considerably less than a year ago, given the unraveling of the condo boom," Murray stated. The 17 percent decline for total construction in the first four months of 2008 relative to last year was due to the following pattern by sector: residential building, down 39 percent; nonresidential building, up 1 percent; and nonbuilding construction, up 5 percent. By geography, four of the five major regions experienced diminished contracting in the January-April period: a 25 percent reduction in the South Atlantic and 19 percent declines in the West, Midwest, and South Central. The Northeast was the only major region able to register a year-to-date gain for total construction, climbing 12 percent.Share this article:

Source: http://www.glassmagazine.com/news-item/commercial/april-construction-advances-9-percentAuthor:

Hot News