Rock Products

APR 2018

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60 • ROCK products • April 2018 ECONOMICS million for the harbor deepening project in Charleston, S.C., and a $240 million lock replacement project in Chatta- nooga, Tenn. The often-volatile electric utility/gas plant category plunged 39 percent in January, following Decem- ber's 93 percent increase. Even with the decline, January included the start of an $872 million gas-fired power plant in Louisiana and a $260 million solar power facility in Texas. Nonresidential Building Nonresidential building was $240.8 bil- lion (annual rate), a slight 1 percent rise on top of December's 10 percent gain. The institutional categories as a group rose 8 percent, led by a 149 percent jump for amusement-related projects. The other institutional project types all showed reduced activity to vary- ing degrees, relative to December. Educational facilities, the largest non- residential building category by dollar amount, slipped 1 percent. Large edu- cational facilities projects that reached groundbreaking in January were a $210 million biomedical innovation building for Stanford University in Stanford, Calif., a $150 million expansion to the Denver Art Museum in Denver and a $100 million exhibition space for the Space Shuttle Endeavor at the California Science Center in Los Angeles. Large high school projects that reached groundbreaking in January were in Crofton, Md. ($96 million), Tyler, Texas ($95 million), and Boiling Springs, S.C. ($95 million), among other localities. Healthcare facilities retreated 10 per- cent in January, although the latest month did include the start of several large hospital projects, such as the $254 million Hubbard Center for Chil- dren Medical Center in Omaha, Neb., the $120 million replacement for the Memorial Hospital Complex in York, Pa., and a $109 million medical center renovation in Canandaigua, N.Y. The remaining institutional categories showed these January declines – trans- portation terminals, down 6 percent; religious buildings, down 23 percent; and public buildings (courthouses and detention facilities), down 25 percent. The 7 percent decline for total construction starts on an unadjusted basis for January 2018 relative to January 2017 was the result of a mixed performance by major sector. Nonbuilding construction increased 4 percent, with public works up 6 percent while electric utilities/gas plants dropped 6 percent. Nonresidential building dropped 20 percent from a strong January 2017, which included such unusually large construction starts as the $3.6 billion Central Terminal Building replacement project at LaGuardia Airport in New York, the $600 million McClellan Business Park data center in McClellan, Calif., and a $477 million terminal project at San Francisco International Airport. Compared to the same month a year ago, the institutional and commercial build- ing segments of nonresidential building were down 23 percent and 21 percent, respectively, while manufacturing plant starts advanced 18 percent. Residential building rose 1 percent from the same month a year ago, with sin- gle-family housing up 3 percent while multifamily housing slipped 2 percent. Useful perspective is made possible by looking at 12-month moving totals, in this case the 12 months ending January 2018 versus the 12 months ending January 2017, which reveal total construction starts advancing 2 percent. By major sector, nonbuilding construction grew 2 percent, with public works, up 12 percent; and electric utilities/gas plants, down 29 percent. Nonresidential building increased 3 percent, with institutional building, up 7 percent; commercial building, down 5 percent; while manufacturing plant starts climbed 26 percent. Residential building grew 2 percent, with single family housing up 8 percent while multifamily housing fell 12 percent. The manufacturing plant category strengthened in January, climbing 99 percent after a weak December. Major manufacturing projects for Jan- uary were a $400 million portion of an upgrade at a semiconductor plant in Chandler, Ariz., a $200 million aerody- namic testing center for the Ford Motor Co. in Allen Park, Mich., a $110 million food processing plant in Longmont, Colo., and a $105 million expansion to a food processing plant in Jack, Ala. The commercial categories as a group fell 15 percent in January. New office construction starts retreated 31 percent after a 44 percent jump in December. The largest January office projects were a $350 million Facebook data center in New Albany, Ohio, a $160 million office building in Washington, D.C., and the $140 million renovation to the Port- land Building in Portland, Ore. Hotel construction dropped 13 percent after a 4 percent gain in December, although the latest month did include the start of a $300 million hotel in New York. The remaining commercial categories witnessed this performance relative to December – stores, down 2 per- cent; warehouses, unchanged; and commercial garages, up 4 percent. Residential building Residential building in January was $331.3 billion (annual rate), up 7 per- cent. Multifamily housing jumped 39 percent, showing renewed strength after a loss of momentum during the closing months of 2017. During January, there were 11 multi- family projects valued at $100 million or more that reached groundbreaking, compared to four in December. The largest January multifamily projects were the $260 million multifamily portion of a $289 million mixed-use complex in San Jose, Calif., a $250 mil- lion multifamily high-rise in Jersey City, N.J., and a $175 million multifamily high-rise in Houston. Single-family housing in January receded 3 percent, settling back after the modest gains reported during the previous five months. In January, sin- gle-family housing showed this pattern by major region – the West, down 11 percent; the South Central, down 2 percent; the South Atlantic, down 1 percent; the Midwest, unchanged; and the Northeast, up 9 percent.

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