1-28-17

Stuff you won’t read in the headlines.

1. Total Construction spending for the last 3 months is at a 10 year high. However, in constant inflation adjusted dollars, construction spending is still 16% below 10 years ago. Are We at New Peak Construction Spending?
2. In the last 36 months, there were 16 Census construction spending releases that initially showed a decline vs the previous month. Five months showed a decline vs the previous year. After revisions every month was revised up from the original posted amount. There remained only 2 significant mo/mo declines. There were no remaining year/year declines.  Construction Spending Gets Revised UP
3. Nonresidential Bldgs new starts (by Dodge Data) in the 2nd half of 2016 posted the best #s since the pre-recession boom. New Construction Starts 2016
4. Nonresidential construction spending within the year is far more dependent on construction starts from previous years than on new starts within the year. Only 20%-25% of all spending within the year comes from new starts within the year. Behind The Headlines – Construction Backlog
5. If Nonresidential New Starts for 2017 fall short of projections by 10%, it would reduce total 2017 nonresidential spending by 2.0% to 2.5%.
6. 25% of all spending on nonresidential bldgs in 2017 comes from projects that started in 2015.
7. 25% of all spending on non-building infrastructure in 2017 comes from projects that started between July 2014 and May 2015. That unusually high period contributes more to 2017 spending than all new infrastructure starts in 2017. Infrastructure Outlook 2017
8. Monthly rate of spending for nonresidential bldgs will reach a new all-time current dollar high by midyear 2017. Behind The Headlines – Nonres Bldgs Construction Spending
9. In constant inflation adjusted dollars, 2017 nonresidential bldgs spending will still be lower than any year from 1995 to 2009, 16% below the 2000 peak. Behind The Headlines – Nonres Bldgs Construction Spending
10. New construction starts in 2016 for Office buildings as compared to 2015 went from -1% year-to-date in July to +30% ytd in September. Good example that we need to be careful because monthly variation sometimes messes up those comparisons. New Construction Starts 2016