Nonresidential building growth highest in years, Index shows

The Dodge Momentum Index, a monthly measure of the first report for nonresidential building projects in planning, rose 2.8 percent in November compared with the previous month, McGraw Hill Construction says. November’s increase brought the momentum index to 117.9, as it regained upward movement after taking a sudden dip in October.

This is the highest reading for the momentum index since March 2009, although the current level is still well below the peak readings from 2007 when it averaged 183. The November upturn in plans for new construction may be an indication that October’s uncertainty over the budget and debt ceiling impasse is now easing, at least until those issues are raised again in January and February, according to the company.

The increase shown in November’s momentum index was driven by gains for both its commercial and institutional components, says McGraw Hill Construction.

On the commercial side, the increases were widespread by project type, with the largest boost coming from a sharp gain in retail development. New retail projects entering the pipeline in November included a $278 million retail and entertainment center in Philadelphia, Pa., a $100 million retail and condominium project in Alameda, Calif., and a $50 million retail and apartment development in Sterling, Va.

The increase in institutional plans was helped by a significant gain for education-related buildings, according to McGraw Hill Construction. The largest were a $100 million Wilson Pacific Elementary and Middle School Campus in Seattle, Wash., an $84 million Science and Health Professions Building at Hunter College in New York N.Y., and a $61 million renovation/expansion to a high school in San Clemente, Calif.