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Nonresidential construction planning activity declined in November, marking the third consecutive month of cooling, according to the Dodge Construction Network.
The Dodge Momentum Index, a benchmark that measures nonresidential construction planning, it was down 2.3% in November. A 4.6 percent drop in trading activity led to most of that decline, while a 2.5 percent increase in institutional planning partially offset the decline, the report said.
Slower planning for data center, office, warehouse and retail projects contributed to the decline in the commercial sector in November, while education projects boosted institutional growth. The institutional segment has now grown in five of the past six months, according to Dodge.
“Through 2024, we have seen strong growth in non-residential planning activity, but labor shortages and high construction costs have prevented these projects from moving through the planning process at a normal pace,” said Sarah Martin, associate director of forecasting for Dodge Construction Network. “Uncertainty about the new rate and immigration policies under President-elect Trump’s administration may also create a pause with developers, although it’s a little too early to tell if that’s the main factor here.”
From a year-over-year perspective, the index remains 12% higher than November 2023 levels. Commercial planning rose 13% over that time period, while institutional planning rose 8%.
However, data centers continue to play an outsized role in this growth through 2023. Without their inclusion, business planning would have fallen 6% and overall DMI would have fallen 1%, according to Dodge.
However, Martin is still waiting for one upturn in activity. He said the easing of monetary policy will eventually help ease this accumulation of projects throughout 2025 and ultimately stimulate more construction demand in the coming months.
Seventeen projects valued at $100 million or more entered planning in November. Major commercial projects include:
- The $350 million Bally’s Hotel Tower and Casino in Las Vegas.
- A $312 million Accokeek data center in Stafford, Virginia.
The largest institutional projects to enter planning included:
- A $465 million student dormitory at UC Berkeley, California.
- The $323 million intensive care tower at Texas Health Presbyterian in Plano, Texas.
