Contractors: learn how Reed Construction Data can help you...

Grow your business
Stay ahead of the competition by accessing Reed Construction Data's comprehensive database of project information, narrowed to your territory and your areas of expertise.
Learn More
Win more bids
Reed Construction Data helps you develop a winning bid strategy, identifying the competition for a given project so you can bid accordingly. Learn More
Increase your profits
Accurate and competitive bids allow you to significantly improve your profitability. RSMeans Cost Data books and online tools provide a comprehensive construction cost database for all types of construction in your specific market. Learn More
Latest News & Information

Nonresidential Construction Starts Rebound Strongly in March

Reed Construction Data announced today that the value of March construction starts, excluding residential contracts, surged 46.9% to $23.7 billion after sinking 14.2% in February. This was the highest value for starts since November 2013.

Since the starts data are not seasonally adjusted (NSA), caution should be used in analyzing monthly movements. Year-over-year comparisons are often used, as they remove much of the seasonal effects. Starts were up a modest 0.4% from March 2013. The year-to-date starts data, which totaled $58.6 billion, were down 2.9% from the same period in 2013. The March starts data are an indication that construction is bouncing back from the harsh winter weather, but still has a way to go.

The value of construction starts1 each month is summarized from the Reed database of all active construction projects in the U.S., excluding residential construction. Missing project values are estimated with RSMeans building cost models.

Value of United States Construction Starts
March 2014 — Year to Date
(Reed Construction Data)
  Jan-Mar 2014
($ millions)
% Change
(Jan-Mar 2014 vs
Jan-Mar 2013)
% Change
(Mar 2014 vs
Feb 2014)
Hotel/Motel 1,692 -64.20% 98.30%
Retail 3,784 -31.50% 46.30%
Parking Garage 384 44.80% 490.60%
Amusement 1,062 11.30% 80.90%
Private Office 3,487 60.60% 0.40%
Government Office 2,803 44.20% 223.60%
Laboratory 384 289.30% -25.40%
Warehouse 1,317 20.00% 274.60%
Miscellaneous Commercial 2,237 -61.60% 428.20%
COMMERCIAL 17,149 -24.10% 109.90%
INDUSTRIAL (Manufacturing) 906 -41.30% 455.10%
Religious 317 -15.20% -26.40%
Hospital/Clinic 4,049 98.20% 111.90%
Nursing/Assisted Living 793 -0.30% 2.60%
Library/Museum 467 16.50% -54.60%
Police/Courthouse/Prison 837 -4.60% 81.60%
Military 868 -11.80% -10.20%
School/College 9,263 -10.80% 20.10%
Miscellaneous Government 835 107.60% 116.90%
INSTITUTIONAL 17,429 7.20% 31.40%
Miscellaneous Non-residential 817 24.20% 77.80%
NON-RESIDENTIAL BUILDING 36,301 -11.60% 68.10%
Airport 286 -2.40% 194.90%
Road/Highway 8,682 9.30% -15.00%
Bridge 2,660 6.50% -19.70%
Dam/Marine 849 -32.50% 49.50%
Water/Sewage 5,103 15.70% 19.20%
Miscellaneous Civil 4,684 64.40% 155.40%
HEAVY ENGINEERING 22,264 15.70% 19.20%
TOTAL NON-RESIDENTIAL $58,564 -2.90% 46.90%
The table is based on not seasonally adjusted (NSA) data.
Source: Reed Construction Data (RCD).
Table: Reed Research Group and Reed Construction Data – CanaData.

View this information as an infographic

Commercial starts doubled in March (+109.9%) after plunging 35.9% the previous month. Year-to-date, commercial starts were down 24.1% from the same period last year. To some extent, that comparison obscures the bounce back in commercial starts, since there were some unusually large starts in the first quarter of 2013. The $17.1 billion first quarter commercial starts were the second highest since 2008.

First quarter lodging (hotel and motel) starts were at their second highest level since 2009. An unusually large starts figure in March 2013 is skewing the year-to-date total for this category. Similarly, first quarter retail starts lagged behind first quarter 2013 starts, but were at their second highest level since 2008.

Industrial (manufacturing) building starts, despite a more than five times increase over an unusually low February number, were still down 41.3% on a year-to-date basis. Although the first quarter 2013 starts were on the strong side, they were not unusually so. First quarter 2014 starts were the second lowest on record since the Reed data series began in 2003. The hope is that this year’s slow beginning is weather related and will be offset by stronger numbers in coming months.

Institutional building starts are showing strength largely due to a strong gain in hospital and clinic starts, which more than doubled in March (+111.9%). On a year-to-date basis, these starts were up 98.2% from the same period a year ago. In spite of improvements in March (+20.1%), starts for schools and colleges were down 10.8% on a year-to-date basis from last year.

Heavy engineering (non-building) starts strengthened 19.2% in March. Year-to-date starts were up 15.7% from the same period in 2013. Road and highway starts, although off 15.0% in March, were up 9.3% on a year-to-date basis.

Surprisingly, heavy engineering starts are doing much better than nonresidential building starts. The weather appears to have adversely affected the latter more than the former. As the weather improves, we are looking for starts of both to improve.

We believe the economy is essentially healthy and on a clear upward trajectory. With a growing economy and low long-term interest rates, nonresidential building construction starts (and, therefore, construction activity) are projected to increase, eventually exceeding last year’s starts numbers.

1 A start is determined by taking the announced bid date and adding 30 days. It is then assumed the project will actually break ground within 30-60 days of the start date. Reed continues to follow the project via our network of researchers so if the project is abandoned or re-bid, then the start data are subsequently updated to reflect the new information.

Click here if you would like to download this information as a PDF file

» read complete article
» view all articles
Information to Help You Grow & Manage your Business
Competition, Risk, and Construction Company Failure - The construction industry has been for many years, and certainly continues to be, one on the most highly competitive of all industries. Second, risk permeates the industry in general and construction operations in particular. Third, the failure rate for construction companies is among the highest of any business.
A Review of General and Administrative Expense - A regular, careful look at G&A expenses can lead to more effective business management…
Marketing Your Construction Firm on the Cheap - If you’re a smaller contractor, don’t make the mistake of thinking marketing and business development apply only to the big guys. A marketing program is needed to make your company known to your potential customers and give them reasons to do business with you. And even if you intend to stay small, you have to stir the pot of potential customers.
Blogging: Website Heal Thyself - This article covers how blogging can add visitor interest to websites.
Becoming an Invited Bidder - How can you as a contractor increase your chances of being invited to bid on a project in this competitive market? Here are a few tips from those in the business.
Pre-Bid Site Inspection - Minimize the risk of oversight in bidding site work with these important tips…
Before You Start a Project -
How to Find Regional Construction Tracking and Forecast Information -
Variables That Affect Project Management - While the benefits of project management are clear, it must be noted that a good project management system — whether manual or computerized — cannot be implemented without an investment of money and time on the part of corporate management. It is, however, an investment that brings a definite and positive return. It is certainly worthwhile to review some of the common problems associated with developing better project management.
Blogs & Websites: The 5 Signs of Website Wellness - This article covers how owners can maximize their blogging business website’s performance.
Free Resources
The benefits just keep piling up...
Get access to numerous free resources
to help grow your business.
More RCD Products
We have much more to offer,
be sure to check out some of the additional
products and services from RCD.