HAMILTON, N.J. — The Dodge Momentum Index rose 3.7% in September to 130.8 (2000=100) from the revised August reading of 126.2. The Momentum Index, issued by Dodge Data & Analytics, is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. Both components of the Momentum Index rose during the month. The commercial component rose 3.9% while the institutional component moved 3.2% higher.
The Momentum Index has made steady, albeit slow, progress since hitting a nadir in June. In the third quarter, the Momentum Index gained 2.2% over the previous three months. The commercial side of the Momentum Index gained 7.4% in the third quarter led by a large number of warehouse projects entering planning as e-commerce retailers such as Amazon Inc. continue to push projects forward. Somewhat surprising is that office projects entering planning also posted a tepid gain despite concerns that office work is shifting to remote settings. The institutional component, however, lost ground in the third quarter; dropping 6.8%. Education projects have borne the brunt of this drop as state and local government revenues declined, creating the need for budget cuts across the country.In September, seven projects each with a value of $100 million or more entered planning. The leading commercial projects were a $120 million office project in San Jose CA and a $110 million Georgia-Pacific distribution facility in De Pere IL. The leading institutional projects were the $275 million EV Smith Research Center at Auburn University in Auburn AL and a $250 million arena in Palm Desert CA.Tagged with construction