Issue link: https://read.dmtmag.com/i/351182
world fence news • august 2014 • 31 The Dodge Report Fewer housing starts drag down May totals NEW YORK, N.Y. — At a sea- sonally adjusted annual rate of $513.4 billion, new construction starts in May dropped 5% from the previous month, according to McGraw Hill Construction, a division of McGraw Hill Financial. The reduced pace for total construction starts reflect- ed a moderate loss of momentum for nonresidential building and housing, while the nonbuilding construction sector eased back slightly. The total construction decline followed two months of strengthen- ing activity, although May's level was still above the lackluster volume reg- istered at the outset of 2014. For the first five months of 2014, total con- struction starts on an unadjusted basis were $201.5 billion, down 1% from the same period a year ago. The May statistics lowered the Dodge Index to 109 (2000 =100), compared to a revised 114 for April. During the first two months of 2014, the Dodge Index was reported at 103. "After the slow beginning to 2014, construction activity during March and April regained upward momentum, and May's retreat does not necessarily mean that renewed ex- pansion is stalling," stated Robert A. Murray, chief economist for McGraw Hill Construction. "The downturn for nonresidential building in May was the result of a sharp pullback by the often-volatile manufacturing plant cat- egory after its huge gain in April. "Residential building has often re- flected the monthly up-and-down pat- tern for multifam- ily housing, which despite a setback in May can still be viewed as trending upward," he said. "Of more concern for residential build- ing is single family housing, which has yet to move beyond its recent plateau and resume growth. Nonbuilding con- struction in May was pulled down by further weakness for electric utilities; at the same time, public works con- struction made a partial rebound in May after retreating during the previ- ous two months." Nonresidential building in May fell 5% to $192.2 billion (annual rate), sliding back following a 15% jump in April. Manufacturing plant construc- tion in May plunged 87% after being lifted in April by the start of several large projects, including a $3 billion ethylene plant in Texas. In contrast, the largest manu- facturing project reported as a May start was an $80 million manufac- turer-owned re- search laboratory in New Jersey. If the manufactur- ing category is excluded, nonres- idential building would have been essentially flat in April, followed by a 20% gain in May. Commercial building showed particularly strong growth in May, climbing 31%, led by gains for of- fices and hotels. Office construction in May surged 94%, led by the start of the massive new headquarters for Apple Inc. in Cupertino, Calif., with $2.3 billion estimated for the office portion of the project's $2.5 billion construction cost. Other large office projects that reached the construction start stage in May included a $130 million data cen- ter in Elk Grove, Ill. and a $56 million office building in San Diego, Calif. Through the first five months of 2014, the top five metropolitan areas ranked by the dollar volume of new office starts were – San Jose, Calif., New York, N.Y., Houston, Washing- ton, D.C., and Boston. Hotel construction in May in- creased 101%, boosted by the start of two large projects – the $272 million Marriott Marquis Hotel in Houston and the $260 million Cleveland Con- vention Center Hotel in Cleveland. After showing improved activity in April, both stores and warehouses retreated in May, falling 23% and 21% respectively. The institutional side of nonres- idential building increased 11% in May, helped by substantial gains for several smaller institutional structure types. The public buildings category jumped 144%, lifted by the start of the $396 million San Diego County Cen- tral Courthouse in San Diego and the $200 million Stockton Courthouse in Stockton, Calif. The transportation terminal cat- egory increased 81%, led by $208 continued on next page "After the slow beginning to 2014, construction activity during March and April regained upward momentum, and May's retreat does not necessarily mean that renewed expansion is stalling." – Robert A. Murray Midwest Tube Mills, Inc. Your Source for Quality Steel Fence Pipe and Tubing Your Source for Quality Steel Fence Pipe and Tubing Midwest Tube Mills, Inc. P.O. 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