At an annual rate of $456.5 billion, the value of new construction contract climbed 4% in September, according to F.W. Dodge. The September gain for total construction was the result of strength for nonresidential building and nonbuilding construction.

The rebound in September, after a two month decline, brings construction contracting to a level slightly above the 1999 average, and according to F.W. Dodge, shows an industry that continues to see expansion, although at a more gradual pace than last year.

“The support for continued expansion has shifted during 2000,” said Robert A. Murray, vice president of economic affairs for F.W. Dodge. “Residential building provided the upward push at the start of the year, but then began to lose momentum by spring. At that point, the slack was picked up by renewed strength for public works, in combination with improvement for both the commercial and institutional building sectors. At least for the near term, public works and institutional building should remain at a high level, but commercial building may well decelerate in the months ahead.”

Nonresidential building in September jumped 14% to $163.8 billion, after a quiet August. Most of the commercial structure types gained including stores, up 11%; office up 16%; and warehouses, up 37%. Hotel construction posted the biggest gain, at 73%, thanks to a $260 million hotel/casino project in Atlantic City. By contrast, manufacturing plan construction fell an additional 6% in September.

“The commercial categories have maintained a brisk pace during 2000, yet they are likely candidates to follow the retreat by single family housing, given the emerging soft landing for the economy and evidence that banks are now tightening lending standards,” said Murray.

The institutional side of nonresidential building showed a mixed performance in September, as school construction gained 9%. Public buildings gained 64%, boosted by the start of an $82 million municipal building in Denver and a $68 million courthouse in Seattle. Transportation terminal work rose 15%, helped by a $135 million airport terminal project in Hartford, CT. Church construction improved 2%, supported, according to F.W. Dodge, by increases in charitable giving levels. Amusement-related work slipped 2%, and health care facilities fell 11%.

The nonbuilding construction category, as a whole, at $94.7 billion, climbed 7%. Electric power plants increased by 14%, thanks to four high profile projects: a $300 million project in Arkansas; a $250 million project in Alabama; a $240 million project in Louisiana; and a $200 million project in Oregon.

By region, total construction in September was as follows: the Northeast, up 8%; the South Atlantic, up 4%; the West, up 2%; the Midwest, down 4%; and the South Central, down 5%.