Rock Products

SEP 2015

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www.rockproducts.com ROCK products • September 2015 • 47 ECONOMICS that featured the start of several huge petrochemical plants. The institutional building group in July eased back 1 percent, receding for the second month in a row after improved activity earlier in 2015. The educa- tional facilities category dropped 20 percent after strengthening during the previous three months. Even with the decline, July included the start of such projects as a $162 million research and development building in Cambridge, Mass., and a $112 million elementary and middle school campus in Seattle. Healthcare facilities in July fell 15 per- cent, maintaining the up-and-down pattern that's been present in 2015, even with the July start of a $250 mil- lion hospital tower in Provo, Utah. The smaller institutional categories all registered gains in July. Transpor- tation-related buildings jumped 120 percent, helped by the start of a $200 million rail service facility in Croton On Hudson, N.Y. The amusement and recreational building category rose 49 percent, after the start of a $130 million student center at the University of Ken- tucky in Lexington, and a $123 million music hall renovation in Cincinnati. Both the public buildings category and churches rebounded from very weak activity in June, posting respective gains of 58 percent and 32 percent. The public buildings category was support- ed by the July start of a $275 million detention center in Indio, Calif. Residential Building Residential building, at $288.5 billion (annual rate), advanced 4 percent in July. In similarity to recent months, the main residential push in July came from multi- family housing, which surged 21 percent. July included the start of 16 multifamily projects valued each at $100 million or more, led by the following – a $468 mil- lion apartment building in Long Island City, N.Y., a $445 million condominium building in New York, and a $358 mil- lion multifamily building in Miami. Single-family housing in July slipped back 4 percent, continuing its up-and- down pattern around a modestly rising trend. The year-to-date dollar amount of single family starts at the U.S. level was up 14 percent, due to this pattern by major region – the West, up 22 per- cent; the South Atlantic, up 19 percent; the South Central, up 10 percent; the Midwest, up 6 percent; and the North- east, down 3 percent. Nonbuilding Construction N o n b u i l d i n g c o n s t r u c t i o n i n J u ly dropped 9 percent to $146.9 billion (annual rate). The decline came as the result of diminished activity for most of the public works categories, which fell 13 percent as a group. Highway and bridge construction retreated 19 percent in July, making it three out of the past four months that weaker activity has been reported, which follows the surprisingly strong pace in early 2015. "The uncertainty arising from the expiring extension of the surface transportation legislation on July 31, along with the depleted Highway Trust Fund, likely played some role in July's pullback for highway and bridge construction," Murray stated. Despite the decline, there were sever- al large highway and bridge projects entered as July construction starts, including the $429 million Southern Ohio Veterans Memorial Highway in Portsmouth, Ohio; the $264 million Belt Shore Parkway Mill Basin Bridge replacement in Brooklyn, N.Y.; and the $187 million Interstate 85 widening and reconstruction in North Carolina. The environmental public works cat- egories in July all reported a dimin- ished volume of construction starts, as follows – river/harbor development, down 20 percent; water supply con- struction, down 23 percent; and sewer construction, down 27 percent. The "miscellaneous public works" category (which includes such diverse project types as site work, pipelines and mass transit), ran counter in July with a 29 percent gain. Large miscellaneous public works proj- ects that reached the construction start stage in July included the $700 million expansion of the Creole Trail natural gas pipeline in Louisiana, a $495 mil- lion oil pipeline replacement in Illinois and Indiana, and a $195 million North- east Rail Corridor project in Connecti- cut. The electric utility and gas plant category increased 9 percent, due to the start of several large power plant projects – an $850 million natural gas- fired power plant in Maryland, a $420 million wind farm in Maine, a $337 million wind farm in Texas, and a $191 million solar power facility in Colorado. Year-to-Date The 19 percent advance for total construction starts on an unadjusted basis during the first seven months of 2015 was due to double-digit gains for residential building and nonbuilding construction, while nonresidential building slipped slightly. By geography, total construction starts during the January-July period of 2015 per- formed as follows – the South Central, up 39 percent; the Northeast, up 29 percent; the South Atlantic, up 17 percent; the West, up 6 percent; and the Midwest, up 4 percent. • Residential building year-to-date was up 19 percent, as a 34 percent jump by multifamily housing joined the 14 percent rise by single family housing. • Nonbuilding construction year-to-date soared 51 percent, with electric utilities and gas plants up 268 percent while public works registered a 12 percent gain. • As 2015 is progressing, the huge year-to-date increase for nonbuilding construc- tion is becoming smaller. • Nonresidential building year-to-date receded 1 percent, reflecting the downward pull from a 22 percent decline for the manufacturing building category, while insti- tutional building was up 6 percent and commercial building was up 1 percent. At the seven-month point of 2015, the top five metropolitan markets ranked by the dollar volume of multifamily starts, with the year-to-date percent change, were as follows – New York, up 79 percent; Miami, up 65 percent; Washington, D.C., up 6 percent; Los Angeles, down 11 percent; and Boston, up 92 percent.

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