June 9, 2021
Construction Momentum Jumps in May
Above: Stock photo from Pixabay.
Commercial planning pushes Index to seventh consecutive monthly gain
HAMILTON, New Jersey – The Dodge Momentum Index moved 9.1% higher in May to 178.0 (2000=100), up from the revised April reading of 163.2. The Momentum Index, issued by Dodge Data & Analytics, is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year.
May’s jump was the result of a large increase in commercial planning activity, which posted its strongest month-over-month increase since October 2017. Institutional planning, meanwhile, fell by less than one percentage point.
Commercial planning had been in a holding pattern over the last four months, but broke out in May due to several sizable data center, office, and warehouse projects that peaked in a 13-year high for the commercial component of the Momentum Index. While essentially flat in May, institutional planning remains at levels not seen since 2009. On a year-over-year basis, both commercial and institutional planning were up from May 2020 (38% and 47% respectively). The Momentum Index overall was also 41% higher than in May 2020.
A total of 21 projects with a value of $100 million or more entered planning during May. The leading commercial projects were a $500 million conversion of a coal-burning power plant to a data center in Barker NY and a $450 million office campus in Los Angeles CA. The leading institutional projects were the $250 million Houston Methodist Hospital Campus in Cypress TX and the $250 million Landmark Center in Boston MA.
The rising trend in planning activity is a good sign that the economic recovery is starting to spread into the construction sector. However, these projects are unlikely to have an impact on construction starts this year. Rising material prices and a continued shortage of skilled labor have led to project delays. On the upside, construction starts are shaping up for a healthy increase in 2022.
MAY 2021 DODGE MOMENTUM INDEX
About Dodge Data & Analytics:
Dodge Data & Analytics is North America’s leading provider of commercial construction project data, market forecasting & analytics services and workflow integration solutions for the construction industry. Building product manufacturers, architects, engineers, contractors, and service providers leverage Dodge to identify and pursue unseen growth opportunities that help them grow their business. On a local, regional or national level, Dodge empowers its customers to better understand their markets, uncover key relationships, seize growth opportunities, and pursue specific sales opportunities with success. The company’s construction project information is the most comprehensive and verified in the industry.
As of April 15th, Dodge Data & Analytics and The Blue Book -- the largest, most active network in the U.S. commercial construction industry -- combined their businesses in a merger. The Blue Book Network delivers three unparalleled databases of companies, projects, and people.
Dodge and The Blue Book offer 10+ billion data elements and 14+ million project and document searches. Together, they provide a unified approach for new business generation, business planning, research, and marketing services users can leverage to find the best partners to complete projects and to engage with customers and prospects to promote projects, products, and services. To learn more, visit: construction.com and thebluebook.com.
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