Total construction starts rose 10 percent in May to a seasonally adjusted annual rate of $1.24 trillion, according to Dodge Construction Network.
Nonbuilding starts gained 49 percent in May, driven by the start of an offshore wind project and an LNG facility, while residential starts lost 7 percent and nonresidential building starts were down 2 percent.
On a year-to-date basis through May, total construction starts are up 11 percent compared to the first five months of 2023. Residential starts are up 16 percent in that time, nonbuilding starts gained 17 percent and nonresidential building starts rose 3 percent.
For the 12 months ending May 2024, total construction starts are up 2 percent compared to the same timeframe last year. Nonresidential building starts are down 7 percent, residential starts are up 4 percent and nonbuilding starts are up 14 percent on a 12-month rolling sum basis.
“Even though May’s gain in construction starts was mainly due to a handful of large projects, the data highlights that there is some grassroots demand building in the market,” says Richard Branch, chief economist at Dodge Construction Network. “Single-family starts, in particular, have risen in eight of the last 12 months despite high mortgage rates. Growth in single-family will incentivize further demand for retail, health and education starts, among others, and the stability in the Dodge Momentum Index, which tracks projects in planning, underscores this optimism.”
Nonbuilding
Nonbuilding construction starts rose 49 percent in May to a seasonally adjusted annual rate of $463 billion.
The increase was buoyed by a large gain in gas/utility starts as two large projects (offshore wind and LNG) got underway. Environmental public works starts fell 10 percent in the month, and miscellaneous nonbuilding starts lost 16 percent. Highway and bridge starts were 22 percent lower in May.
On the year, total nonbuilding starts are 17 percent higher. In that time, gas/utility starts are up 35 percent, environmental public works and miscellaneous nonbuilding are each up 24 percent, and highway and bridge starts wareere up 3 percent.
The largest nonbuilding projects to break ground in May were the $10 billion Dominion Energy offshore wind project off Virginia Beach, Virginia; the $11 billion trains 1 and 2 of the Port Arthur LNG project in Port Arthur, Texas; and the $1 billion Green River Energy Center in Emery County, Utah.
Nonresidential
Nonresidential building starts fell 2 percent in May to a seasonally adjusted annual rate of $415 billion.
Manufacturing starts lost 14 percent following a very strong April, while institutional starts dropped 6 percent. Commercial starts gained 10 percent due to increases in warehouse, office and parking starts.
On the year, total nonresidential starts are up 3 percent. Institutional starts are 20 percent higher, while commercial starts are down 5 percent and manufacturing starts are 19 percent lower.
The largest nonresidential building projects to break ground in May were the $2.1 billion Tennessee Titans football stadium in Nashville, Tennessee; the $1 billion Gotion EV battery plant in Manteno, Illinois; and the $875 million General Motors battery cell factory in New Carlisle, Indiana.
Residential
Residential building starts moved 7 percent lower in May to a seasonally adjusted annual rate of $365 billion.
Single-family starts rose 2 percent, while multifamily starts lost 25 percent in the month.
Through the first five months of the year, total residential starts are 16 percent higher. Single-family starts improved 29 percent, and multifamily starts are 5 percent lower.
The largest multifamily structures to break ground in May were the $200 million The Atlantic Club in Long Branch building in Long Branch, New Jersey; the $150 million mixed-use project at 880 Atlantic Ave. in Prospect Heights, New York; and the $150 million Tuscany at Gabriella Pointe in Gilbert, Arizona.
