Total construction starts fell 14 percent in November to a seasonally adjusted annual rate of $867.8 billion, according to Dodge Construction Network. Nonbuilding and nonresidential building starts bore the brunt of the decline, falling 30 and 21 percent, respectively after seeing sharp increases in October as three large projects broke ground. Residential starts gained a modest 3 percent. Without October’s large projects, total construction starts in November would have increased by 5 percent.
“Large projects aside, the underlying trend continues to point to a modest recovery in construction starts,” states Richard Branch, chief economist for Dodge Construction Network. “However, even as projects continue to move forward, the short-term outlook remains cloudy due to continued escalation in material prices and labor shortages. While construction should see some reprieve in 2022, these challenges will restrain the industry’s ability to fully capitalize on both the large number of projects in planning and funding resulting from the infrastructure package. The result will be moderate growth in construction starts over the near-term.”
Below is the breakdown for construction starts:
- Nonbuilding construction starts dropped 30 percent in November to a seasonally adjusted annual rate of $188.1 billion. This decline in activity followed a strong October, which included the groundbreaking of an $8.5 billion LNG export facility. With that project removed from the data, November starts would have increased 13 percent. November’s miscellaneous nonbuilding category jumped 70 percent, and highway and bridge starts gained 11 percent. However, environmental public starts lost 14 percent, and starts of utilities/gas plants fell 69 percent. Year-to-date, total nonbuilding starts were 1 percent higher than a year earlier through November. Environmental public works were 19 percent higher, and utility/gas plant starts were up 15 percent. Highway and bridge starts were 7 percent lower and miscellaneous nonbuilding fell 15 percent during the first 11 months of the year.
The largest nonbuilding projects to break ground in November were the $1.6 billion Vineyard Wind, an 1,800 MW offshore wind project in Barnstable, Mass., the $337 million portion of the Foothill Gold Line light rail project in Glendora, Calif., and the $325 million Sonoran Solar project in Buckeye, Ariz.
- Nonresidential building starts lost 21 percent in November, falling to a seasonally adjusted annual rate of $281.1 billion. This decline is due to the start of two large manufacturing projects beginning in the previous month. Without these two projects in the data, nonresidential building projects would have increased 5 percent in November. In November, commercial building starts fell 10 percent, with only parking structures and warehouses showing small gains. Manufacturing fell by a sharp 96 percent. Institutional starts, by contrast, gained 28 percent, with all categories rising. In the first 11 months of 2021, nonresidential building starts were 11 percent higher. Commercial starts increased 7 percent, manufacturing starts were 86 percent higher, and institutional starts were up 5 percent.
The largest nonresidential building projects to break ground in November were the $2.6 billion first phase of the Terminal 1 replacement at San Diego International Airport in California, the $840 million Robley Rex VA Medical Center Campus in Louisville, Ky., and the $419 million expansion of the Wisconsin Convention Center in Milwaukee, Wis.
- Residential building starts rose 3 percent in November to a seasonally adjusted annual rate of $398.6 billion. Multifamily starts moved 16 percent higher, while single family starts slipped 2 percent. Through the first 11 months of 2021, residential starts were up 20 percent over the same period one year ago. Single family starts gained 20 percent, and multifamily start rose 23 percent.
The largest multifamily structures to break ground in November were the $300 million first phase of the High St. Atlanta mixed-use projects in Dunwoody, Ga., the $237 million North Loop Green 3 Project in Minneapolis, and the $200 million 60 Kilmarnock St. residential building in Boston.
- Regionally, total construction starts improved in the Northeast and Midwest regions but fell in the South Atlantic, South Central, and West regions.