Construction Spending is down in each of last 5mo, now down a total -2.4% from Dec. Biggest declines are Warehouse -7.7%, Commercial w/o Wrhse -4.6%, Office w/o Data Centers -4.3%, Residential -4.2%, Transportation -3.7% and Manufacturing -3.5%.

Residential posted the biggest $ rate drop, -$40bil SAAR since Dec.

Data Centers are up 9% in 5mo, but last year DC were up 56%, increasing 15% in the 4th qtr alone. The rate of growth has slowed from near 4%/mo in the 2nd half 2024 to less than 2%/mo in the 1st 5mo 2025.

With this issue of May Construction Spending, Census revised all data back through 2023. Total spending was revised UP $52bil in 2023 and $39bil in 2024. Due to the increase in 2024, all percent growth in 2025 is slightly lower. The largest revisions up in 2024 were Residential +$11bil, Educational +$8bil and Power +$8bil. Also, in 2023, Power was revised up +$17bil and Manufacturing +$9bil.

Office vacancy rates are very high, near 20%, and in some places, like San Francisco, about double that. It’s hard to see that office construction will increase anytime soon. Office construction spending has declined every month for the last 10 months and is down 10% compared to the same 5mo 2024.