National nonresidential construction spending rose 2.4% in January, according to an Associated Builders and Contractors analysis of U.S. Census Bureau data released today. At a seasonally adjusted annualized rate, nonresidential spending totaled $762.5 billion for the month, an increase of 4.8% over the previous year. Public nonresidential construction spending expanded 4.9% in January and private spending increased 0.8%. Both public and private nonresidential spending are up 8.5% and 2.4%, respectively, on a yearly basis.
âAn uptick in investment in certain infrastructure categories has been at the center of the ongoing nonresidential construction spending cycle,â said ABC Chief Economist Anirban Basu. âDuring the past year, construction spending has increased at rapid rates in conservation and development, highway and street, and transportation. While there has been much discussion about expanding infrastructure investment at the federal level, most of that investment has taken place at a state and local level, especially as government finances have improved in much of the nation, therefore supplying more support for infrastructure outlays. Significant job growth also has helped bolster income tax collections while rising real estate values have triggered improved property tax collections.Â
âMeanwhile, still reasonably strong consumer spending has helped support growing construction in segments like lodging,â said Basu. âConstruction of data and fulfillment centers also has created demand for nonresidential construction services. The recent moderation in construction materials price increases has helped support construction starts because more developers and their financiers are concluding that new projects make business sense.Â
âWhile there has been some reduction in business and consumer confidence, the nonresidential construction spending cycle remains firmly in place for now,â said Basu. âDespite the recent dip in ABCâs Construction Backlog Indicator, backlogs remain sufficient to support solid nonresidential spending activity through the balance of 2019. And while many economists remain concerned about economic prospects in 2020 and beyond, nonresidential constructionâs outlook remains benign at least into 2021.â
Â
Â
Related Stories
Industry Research | Nov 8, 2016
Austin, Texas wins âTop Cityâ in the Emerging Trends in Real Estate outlook
Austin was followed on the list by Dallas/Fort Worth, Texas and Portland, Ore.
Market Data | Nov 2, 2016
Nonresidential construction spending down in September, but August data upwardly revised
The government revised the August nonresidential construction spending estimate from $686.6 billion to $696.6 billion.
Market Data | Oct 31, 2016
Nonresidential fixed investment expands again during solid third quarter
The acceleration in real GDP growth was driven by a combination of factors, including an upturn in exports, a smaller decrease in state and local government spending and an upturn in federal government spending, says ABC Chief Economist Anirban Basu.
Market Data | Oct 28, 2016
U.S. construction solid and stable in Q3 of 2016; Presidential election seen as influence on industry for 2017
Rider Levett Bucknallâs Third Quarter 2016 USA Construction Cost Report puts the complete spectrum of construction sectors and markets in perspective as it assesses the current state of the industry.
Industry Research | Oct 25, 2016
New HOK/CoreNet Global report explores impact of coworking on corporate real rstate
âAlthough coworking space makes up less than one percent of the worldâs office space, it represents an important workforce trend and highlights the strong desire of todayâs employees to have workplace choices, community and flexibility,â says Kay Sargent, Director of WorkPlace at HOK.
Market Data | Oct 24, 2016
New construction starts in 2017 to increase 5% to $713 billion
Dodge Outlook Report predicts moderate growth for most project types â single family housing, commercial and institutional building, and public works, while multifamily housing levels off and electric utilities/gas plants decline.
High-rise Construction | Oct 21, 2016
The worldâs 100 tallest buildings: Which architects have designed the most?
Two firms stand well above the others when it comes to the number of tall buildings they have designed.
Market Data | Oct 19, 2016
Architecture Billings Index slips consecutive months for first time since 2012
âThis recent backslide should act as a warning signal,â said AIA Chief Economist, Kermit Baker.
Market Data | Oct 11, 2016
Building design revenue topped $28 billion in 2015
Growing profitability at architecture firms has led to reinvestment and expansion
Market Data | Oct 4, 2016
Nonresidential spending slips in August
Public sector spending is declining faster than the private sector.