Rock Products

JAN 2013

Rock Products is the aggregates industry's leading source for market analysis and technology solutions, delivering critical content focusing on aggregates-processing equipment; operational efficiencies; management best practices; comprehensive market

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FEATURE same time, nonresidential building in November showed improvement after its loss of momentum during the prior two months, and housing continues to strengthen." Nonbuilding construction – During the first 11 months of 2012, nonbuild‐ ing construction was up 1 percent from the same period a year ago. While pub‐ lic works construction year‐to‐date was down 1 percent, it was offset by a 4 percent gain for electric utilities. Four of the six public works categories showed year‐to‐date declines – bridge construction, down 3 percent; sewer construction, down 12 percent; and river/harbor development, down 21 percent. The two public works cate‐ gories reporting year‐to‐date increases were water supply systems, up 7 per‐ cent; and miscellaneous public works, up 41 percent. The large gain for mis‐ cellaneous public works reflected a sharp rise in the amount of pipeline and rail‐related work. Nonresidential building – For the January‐November period of 2012, nonresidential building was down 13 percent relative to the same period a year ago. The institutional sector fell 14 percent, as weaker activity was re‐ ported for its two largest categories – educational buildings, down 15 per‐ cent; and healthcare facilities, down 12 percent. Other institutional declines on a year‐to‐date basis were the following – public buildings, down 10 percent; churches, down 23 percent; and amusement‐related projects, down 24 percent. The manufacturing plant cate‐ gory year‐to‐date plummeted 45 per‐ cent, reflecting the comparison to 2011, which included a $3.0 billion coal‐to‐gasoline plant and two large semiconductor plants. The commercial sector year‐to‐date managed to in‐ crease 2 percent, lifted by increases for stores, up 8 percent; warehouses, up 9 percent; and hotels, up 20 percent. Of‐ fice construction year‐to‐date was down 14 percent, due in part to the comparison to 2011, which included the start of a $1.1 billion government data center in Utah. While the dollar amount for nonresidential building was down 13 percent for the first 11 18 ROCKproducts • JANUARY 2013 months of 2012, square footage for nonresidential building was up 2 per‐ cent during this time. Residential building – During the first 11 months of 2012, residential building advanced 28 percent compared to the same period a year ago. Single family housing climbed 29 percent, as the re‐ sult of this year‐to‐date performance by geography – the West, up 41 per‐ cent; the Midwest, up 30 percent; the South Atlantic, up 27 percent; the South Central, up 23 percent; and the Northeast, up 14 percent. Multifamily housing rose a similar 27 percent, as the result of this year‐to‐ date performance by geography – the West, up 40 percent; the South Atlantic, up 31 percent; the South Central, up 26 percent; the Northeast, up 25 percent; and the Midwest, up 12 percent. The top five metropolitan areas in terms of the dollar amount of multifamily starts were – New York, up 33 percent; Washington, D.C., up 6 percent; Miami, up 144 percent; Los Angeles, up 29 percent; and Boston, up 21 percent. The large increase for multifamily housing in the West was helped by the 29 percent gain for Los Angeles, as well as growth in such metropolitan areas as Seattle, up 51 percent; San Fran‐ cisco, up 23 percent; Denver, up 114 percent; and Portland, up 79 percent. The 3 percent pickup for total con‐ struction starts at the national level during the first 11 months of 2012 was the result of a mixed performance at the five‐region level. Leading the way was the South Atlantic, up 20 percent, with much of the upward push coming from the start of two massive nuclear power projects in Georgia and South Carolina. If these two projects are ex‐ cluded, then total construction in the South Atlantic would be down 1 per‐ cent. Year‐to‐date gains for total con‐ struction were also reported for the South Central and the Midwest, each up 7 percent. Year‐to‐date declines for total construction were reported for the Northeast, down 5 percent; and the West, down 10 percent. Looking Ahead to 2013 The U.S. transportation construction infrastructure market is expected to show modest growth in 2013, increas‐ ing 3 percent from $126.5 billion to $130.3 billion, according to the Ameri‐ can Road and Transportation Builders Association's (ARTBA) annual forecast. The association's chief economist, Dr. Alison Premo Black, released her find‐ ings during a November 30 webinar for Wall Street analysts and construction industry executives. Growth is expected in highway and street pavements, private work for driveways and parking lots, airport ter‐ minal and runway work, railroads, and port and waterway construction. ARTBA predicts the bridge market, which has shown substantial growth over the last 10 years, to remain flat next year. The federal surface transportation pro‐ gram, combined with state and local government transportation invest‐ ments, are the most significant drivers of the national transportation infra‐ structure construction market. According to Black, the pavements market will be sluggish in 2013, grow‐ ing 2.8 percent to $58.4 billion. This in‐ cludes $47.7 billion in public and private investment in highways, roads and streets, and $10.7 billion in largely private investments in parking lots, driveways and related structures. Monthly Construction Starts (Unadjusted Totals, In Millions of Dollars) Nonresidential Building Residential Building Nonbuilding Construction Total Construction 11 Mos. 2012 $134,894 $148,756 $140,728 $424,378 11 Mos. 2011 % Change $154,784 -13 $115,973 +28 $139,556 +1 $410,313 +3 www.rockproducts.com

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