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April Construction - Nonresidential down 2%

April’s construction stats are out and it looks like we have little change from last month. Here are some of highlights for the commercial subcontractor from the May McGraw-Hill Construction Forecast.

Nonresidential building in April dropped 2% to $160.2 billion (annual rate), down slightly after the 26% gain reported for March. Much of April’s decreased contracting came from the commercial and industrial structure types, which had been boosted in March by the start of several very large projects. Office construction in April dropped 55%, after being lifted in March by the start of a $1.1 billion data center for the National Security Agency in Utah. While down substantially, the office category in April did include the start of a $126 million corporate headquarters in Akron OH as well as the $125 million office portion of the $420 million City Center mixed use project in Washington DC. The manufacturing plant category in April was also down substantially, falling 59% from March which included the start of a $900 million semiconductor plant in Oregon. Both stores and warehouses posted large April declines, sliding 22% and 30%, respectively. Running counter to the generally downward trend for commercial building in April was hotel construction, which jumped 91%. Large hotel projects that reached groundbreaking in April included a $127 million hotel in New York NY and a $108 million hotel in Bloomington MN.

The institutional side of the nonresidential market in April was mixed. The largest gain was registered by transportation terminal work, soaring 287% with the support of several large projects. These included a $1.2 billion airport terminal renovation and expansion at JFK International Airport in New York NY, a $580 million train and bus terminal in San Francisco CA, and a $135 million airport terminal expansion in Philadelphia PA. Healthcare facilities in April strengthened after a sluggish March, climbing 24% with the push arising from such large projects as a $470 million medical center in San Antonio TX and a $175 million hospital in Jonesboro AR. The educational building category in April improved 3%, helped by a $103 million expansion to a medical research facility in Madison WI, a $65 million expansion to an art museum in Queens NY, and a $64 million expansion and renovation to a high school in Massachusetts. The other institutional categories in April showed reduced activity, with amusement-related projects down 5%, public buildings down 10%, and churches down 11%.

Nonbuilding construction, at $116.5 billion (annual rate), dropped 3% in April. Much of the downward pull came from a slower pace for electric utilities, which fell 31% from March, as this category continued to retreat from its exceptional February amount. While not as brisk as the previous two months, electric utilities did see the start of several large projects in April, including a $550 million natural gas-fired power plant in California and a $425 million wood-fired biomass power plant in Florida. For the public works categories, April showed improved activity for sewer systems which advanced 86%, reflecting the start of a $164 million waste water treatment system at Camp Pendleton CA. Highway and bridge construction in April climbed 5%, aided by the start of a $357 million reconstruction project on I-95 in New Haven CT. The miscellaneous public works category, which includes diverse project types, rose 10% in April with help from the start of a $150 million automotive racetrack in Austin TX. On the negative side, April showed slower contracting for water supply systems, down 4%; and river/harbor development, down 32%.