July included a few noteworthy education-related projects, led by a $93-million high school in Mountain House, Calif., which is being financed via a leaseback arrangement, as well as a $65-million science building at Ohio State University in Columbus. However, these projects were not enough to avert a decline for the educational building category in July.
Health-care construction in July dropped 10%, even with the start of a $156-million replacement hospital at Fort Irwin, Calif., and a $113-million hospital expansion in Silver Spring, Md. Also showing declines in July were amusement-related construction, down 13%; and churches, down 10%. The public buildings category, comprised of courthouses and detention facilities, edged up 1% in July. Transportation terminal work rebounded 50% from a weak June, helped by the start of a $96-million terminal expansion at Dulles International Airport in Virginia.
The commercial categories in July were able to show modest growth. Hotel construction in July climbed 13%, lifted by the start of a $50-million hotel and casino in Wilkes Barre, Pa., and a $29-million hotel addition/renovation in Denver. Store construction in July advanced 6%, led by the start of a $70-million retail project in Las Vegas and a $49-million retail project in El Paso.
Office construction in July grew 4%, following a steep 30% drop in June, helped by the start of such projects as a $101 million office complex in Eden Prairie, Minn., and a $50-million office renovation in Las Vegas. Warehouse construction in July maintained the same volume of activity reported in June. The manufacturing plant category in July dropped 31%, retreating for the second month in a row after the heightened activity back in May.
Residential Building
Residential building in July slipped 6% to $154.0 billion (annual rate). The decline was due to a 25% pullback for multifamily housing, following strengthening activity in May (up 32%) and June (up 7%). Cushioning the multifamily decline in July were the start of such projects as a $95-million apartment building in Boston, a $94-million apartment building in Jersey City, N.J., a $78-million apartment building in Los Angeles, and a $61-million senior living facility in Pleasanton, Calif.
The July pace for multifamily housing, while down 6% from the first six months of 2012, was still 10% above the average pace for this project type during 2011. Single-family housing in July edged up 1%, not as strong as some of the gains shown earlier in 2012, but essentially maintaining the improved amount reported in May and June. The July pace for single-family housing was up 6% from the first six months of 2012, and up 27% from the average pace for this project type during 2011.
The 4% increase for total construction starts on an unadjusted basis during the first seven months of 2012 was due to greater activity for two of the three main construction sectors. Residential building climbed 25% year-to-date, with similar gains for single-family housing, up 24%; and multifamily housing, up 26%.
Non-building construction grew 7% year-to-date, reflecting a 19% jump for electric utilities and a 1% pickup for public works. Nonresidential building continued to be the one major sector to report a year-to-date decline, falling 15%, as the result of this pattern by segment—commercial building, down 1%; institutional building, down 18%; and manufacturing building, down 35%.
The year-to-date decline for nonresidential building has been getting smaller as 2012 has proceeded, although it still reflects the comparison to the same period a year ago, which included such projects as a $1.5-billion semiconductor plant in Arizona, the $1.2-billion redevelopment of the Delta Terminal at New York’s JFK International Airport, and the $1.1-billion National Security Agency data center in Utah.
By geography, total construction starts during the first seven months of 2012 featured a large gain for the South Atlantic, up 42%, with much of the lift coming from the start of the two massive nuclear power projects in Georgia and South Carolina. Total construction in the Midwest during the January-July period was up 5%, while reduced activity was reported in the South Central, down 7%; the West, down 8%; and the Northeast, down 11%.