October construction starts drop 9%
- The value of October construction starts dropped 9% from September to a seasonally adjusted rate of $742.9 billion, according to Dodge Data & Analytics. That figure erases more than half of last month's gains.
- Nonresidential starts dropped 30% in October after a group of large projects pushed that category up by 37% in September. The nonbuilding category, however, saw a 27% increase due to the $3 billion expansion of a natural gas pipeline in Pennsylvania and Virginia. A cooling of the multifamily market forced residential down 1%.
- The latest reading of the Dodge Index fell to 157, down from the upward-revised September mark of 173. According to Dodge, October's downturn in starts was expected, as September's spike in nonresidential projects did not represent a sustainable pace.
One of the biggest drivers of the September's surge in starts was the beginning of construction on the $6 billion Shell Chemicals ethane cracker plant in Pennsylvania. The project only went vertical earlier this month, but early site prep and foundation work allowed it to be counted among September starts. The month was also driven by two massive New York City-based developments — the $4 billion Delta Airlines terminal at LaGuardia International Airport and the $1.7 billion 50 Hudson Yards high-rise.
Though nonresidential starts continue to drive starts data, this month's figures were largely driven by the new $1.1 billion Texas Rangers ballpark. The 41,000-seat stadium won't be the only attraction, though. Surrounding entertainment-based space will feature an adjacent Texas Live! entertainment venue, already under construction, along with 35,000 square feet of convention space, a 300-room hotel and 200,000 square feet of entertainment and retail offerings.
A $10 billion ExxonMobil ethane steam cracker plant project around Corpus Christi, TX, could also give a boost to future starts reports. Part of the company's Gulf Coast Growth Ventures joint venture with Saudi Arabia-based Sabic, the plant, when complete, will be the largest facility of its kind in the world. The project will include two polyethylene and one ethylene glycol plants and employ 600 people. Already, the plant has had a notable economic impact on its community, with 12 of its 13 contracts already being awarded to local companies.
- Dodge Data & Analytics October Construction Starts Fall 9 Percent
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