New Construction Starts Increased 1% in February
"The improved contracting in January and February gets 2002 off to a good start, and shows that construction remains at least for now one of the more resilient sectors of the economy," stated Robert A. Murray, vice president of economic affairs for F. W .Dodge.
Nonresidential building in February grew 5% to $169.8 billion. Following a depressed January, strong percentage gains were reported for hotels, up 61%; offices, up 32%; and warehouses, up 6%. Store construction, which experienced a more gradual downturn during 2001 compared to the other commercial categories, climbed 20% in February.
"It's true that commercial building continues to be weak by the standards of 1999 and 2000, and a sustained upturn for these structure types is at least several quarters away," stated Murray. "Still, the improved performance in February does suggest that much of the correction for commercial building has already taken place, and the next few months will see an up-and-down pattern more consistent with a market that is beginning to stabilize."
The institutional categories in February were mixed. School construction retreated 9% from an exceptional January; at the same time, February can be viewed as a healthy month for schools, with contracting stil12% above the average level during 2001. Healthcare facilities and transportation terminals were also down from heightened January amounts, with respective declines of 36% and 14%. On the plus side, February showed increases for public buildings (courthouses and detention facilities), up 29%; amusement-related projects, up 5%; and churches, up 4%.
By geography, the January-February period registered this pattern for total construction -the Midwest, up 22%; the South Atlantic, up 15%; the Northeast, up 1%; the South Central, down 11%; and the West, down 12%.