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Construction activity slowed in June after a busy month of multiple multibillion-dollar initiatives.
Total starts fell 19.9% month over month in June at a seasonally adjusted annual rate of $1.42 trillion, according to a report from the Dodge Construction Network. The decline followed a period of particularly strong activity during which contractors started several large-scale projects in sectors such as energy and infrastructure.
“After strong megaproject activity in May, construction starts came back down to earth throughout June,” Sarah Martin, director of economic research at Dodge Construction Network, said in a statement. “Residential and institutional construction remains weak, while commercial, industrial and non-building construction continues to show strong growth year-to-date.”
Nonresidential building starts fell 9.1% month-over-month in June, according to the report. In particular, manufacturing construction plunged 62.9% during the period, while starts in other sectors, such as office and data centers, fell 3.7%.
On a positive note, commercial construction rose 1.2% in the month, led by gains in warehouse, hotel and retail construction activity, according to Dodge.
In the first six months of the year, total non-residential starts rose 6.2%, driven by a 17.9% increase in commercial projects. Institutional building activity, such as education and healthcare starts, declined 7.3% year-on-year through June, according to the report.
Courtesy of Dodge Construction Network
Non-building construction, such as infrastructure construction work, fell 37.7% month-on-month in June, according to the report. The decline included a 46.6% drop in the highways and bridges category, and a 70.3% drop in utility construction. These pullbacks followed a massive breakthrough month in May, when the non-building category posted a 91.9% month-over-month increase.
Despite the month-on-month declines, new non-building developments in the first half of the year still increased. According to the report, through the end of June, non-building starts were up 33.8% compared to last year.
Courtesy of Dodge Construction Network
Housing starts softened month over month in June, according to the report. Single-family starts fell 3.4% month-over-month, while multifamily construction fell 0.4% during the month-over-month period in June.
According to Dodge, the biggest projects to start in June included:
- The $3.6 billion Delta Forge 1 hyperscale data center campus in Boyce, Louisiana.
- The $2.4 billion Cleveland Browns Huntington Bank Field Stadium in Brook Park, Ohio.
- The $2.1 billion Sentinel Midstream deepwater port in Freeport, Texas.
- The $2.1 billion Amtrak Sawtooth Bridge Replacement in Kearny, New Jersey.
- Phase 2 of the $2 billion AWS data center in Canton, Mississippi.
- The $480 million residential conversion of 1740 Broadway in New York City.
- The $251 million River Commons residential and community facility in Concourse, New York.
- The $191 million residential conversion of 40 Exchange Place in New York City.
