Rock Products

NOV 2014

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www.rockproducts.com ROCK products • NOVEMBER 2014 39 The commercial building group in Sep‐ tember fell 15 percent, retreating from its heightened amount in August. Store con‐ struction declined 22 percent, after being lifted in August by the $157 million retail portion of the $957 million Nordstrom Tower in New York. Office construction dropped 23 percent, although September did include the start of such projects as a $700 million data center for Microsoft in West Des Moines, Iowa, a $250 million office tower in Chicago, a $105 million office tower in Houston, and a $100 million headquar‐ ters building for American Greetings in Westlake, Ohio. Hotel construction in September slipped a modest 1 percent, with some support coming from $140 million for the hotel portion of the National Harbor MGM Casino Resort in Oxon Hill, Md. Ware‐ house construction was the one com‐ mercial structure type able to post a gain in September, rising 2 percent with the help of groundbreaking for a $90 million distribution center in Georgia. Nonbuilding Construction Nonbuilding construction, at $162.9 bil‐ lion (annual rate), jumped 38 percent in September. The electric utility category, which has trended downward for the past year and a half, climbed 107 percent from its lackluster August pace. There were two very large electric power plant projects included as Sep‐ tember starts – a $1.7 billion retrofit of a coal‐fired power plant in Illinois and a $1.0 billion solar power facility in Ne‐ vada. The public works project types as a whole advanced 26 percent in Sep‐ tember. The miscellaneous public works category increased 83 percent, which reflected the start of the $834 million Regional Connector Transit Corridor light rail project in Los Ange‐ les, a $204 million liquefied natural gas pipeline project in Tucson, Ariz., and a $150 million gas main replacement project in Hackensack, N.J. The miscellaneous public works category in September also included ground‐ breaking for the $672 million Atlanta Braves baseball stadium in Smyrna, Ga. (In the Dodge classification of sports are‐ nas and stadiums, projects with a roof are included in the amusement category while projects without a roof are in‐ cluded in the miscellaneous public works category.) River/harbor development in Septem‐ ber climbed 40 percent, lifted by a $117 million storm sewer project in New Or‐ leans, while sewer construction rose 31 percent with the boost coming from a $285 million waste water treatment plant in Baltimore. Highways and bridges each climbed 8 percent in September, although both are still trending downward as shown by the following year‐to‐dates declines – high‐ ways, down 11 percent; and bridges, down 21 percent. Water supply con‐ struction was the one public works cate‐ gory to lose momentum in September, sliding 27 percent. Residential Building Residential building in September dropped 9 percent to $212.7 billion (an‐ nual rate). Multifamily housing fell 23 percent, retreating from the strong activ‐ ity that was reported in August. Even with this decline, September still in‐ cluded groundbreaking for four multi‐ family projects valued each in excess of $100 million. They were the following – a $266 million condominium hotel in Hollywood, Calif.; the $230 million mul‐ tifamily portion of a $370 million mixed‐ use project in Washington, D.C.; a $215 million condominium complex in Hon‐ olulu; and a $183 million condominium tower in Miami. Single‐family housing in September slipped 3 percent, marking the third straight month of modest erosion after a brief pickup in late spring, which in a broad sense maintains the flat pattern that's been present throughout 2014. In September, weaker single‐family con‐ struction was reported in the South At‐ lantic, down 6 percent; the South Central, down 4 percent; and the West, down 3 percent; while gains were reported in the Midwest and Northeast, up 2 percent and 4 percent, respectively. Murray indicated, "This year's stall for single‐family housing means that the lift provided to total construction is much less than what occurred during the prior two years, when single‐family housing advanced 29 percent in 2012 and 26 percent in 2013. The 20 percent down payment requirement, generally in effect since the end of the financial crisis, has made it difficult for lower and middle income households to get approved for a mortgage, and more at‐ tention is now being directed by federal officials at ways to expand access to home loans." E Year-to-Date The 5 percent gain for total construction starts on an unadjusted basis during the first nine months of 2014 was the result of a varied pattern by the major construction sector. • Nonresidential building climbed 17 per- cent year-to-date, due to this perform- ance by segment – commercial building, up 13 percent; manufacturing building, up 112 percent; and institutional building, up 5 percent. • Residential building grew 6 percent year- to-date, with single-family housing up only 1 percent while multifamily housing advanced 20 percent. • Nonbuilding construction decreased 9 percent year-to-date, with public works down 8 percent and electric utilities down 13 percent. By geography, total construction starts in the first nine months of 2014 revealed these gains for the five major regions – the South Central, up 15 percent; the South Atlantic, up 5 percent; the Northeast, up 4 percent; and the Midwest and West, each up 1 percent. Through the first nine months of 2014, the top five metropolitan areas in terms of the dollar amount of new multifamily projects were – New York, Washington, D.C., Miami, Los Angeles and San Francisco. Metropolitan areas ranked six through 10 were – Dallas-Ft. Worth, Boston, Houston, Seattle and Denver.

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