Construction planning momentum faltered in November, though developers in key sectors continue to press forward, according to Dodge Construction Network.
The Dodge Momentum Index, which tracks nonresidential construction projects entering the planning stages and leads actual construction spending by a full year, slipped 1.1% in November. Commercial planning ticked down 0.1%, a marginal drop compared to the 3.4% decrease in institutional planning over the month, according to the report.
Despite the decrease, the index sits 36% higher year-to-date than its average reading over the same period in 2024. That’s largely due to momentum in the data center and healthcare construction sectors, said Sarah Martin, associate director of forecasting at Dodge Construction Network.
“The influx of high-value data center work, compounded by inflationary cost pressures, continues to support elevated DMI levels,” said Martin in the release. “Overall, nonresidential construction is expected to strengthen in 2027, led primarily by data center and healthcare projects.” But other nonresidential sectors are more likely to face softer demand in the upcoming year. Martin warned last month to expect overall planning to decelerate on average, especially as macroeconomic risks around costs continue to mount.
On the commercial side, planning activity weakened in November for warehouse and hotel projects. Those figures remained somewhat steady for traditional offices and retail construction, according to the report.
On the institutional side, which includes education and healthcare projects, planning also slowed across most categories after strong activity in recent months, according to Dodge. However, the report noted positive momentum around religious-related construction.
Compared to November 2024, the index jumped 50%, with the commercial and institutional segments up 57% and 37%, respectively. Without the data center boom, commercial planning growth would be 36% over that same period, according to the report.
A total of 28 projects valued at $100 million or more entered planning in November, according to Dodge. Major commercial projects included:
- The $406 million Novva Mesa data center in Mesa, Arizona.
- The $317 million Compass data center in Hoffman Estates, Illinois.
- The Medina Technology Data Center Park in Medina, Texas.
The largest institutional projects to enter planning included:
- The $425 million Novi School renovations in Novi, Michigan.
- The $250 million James City County Government Complex relocation in Williamsburg, Virginia.
- The $180 million Police and Fire Administration Headquarters in Mountain View, California.
