The decline for the amusement category was relative to a very strong December, which included the start of the $763-million Vikings Multipurpose Stadium in Minneapolis. Large project support for the amusement category was also present in January, coming from $90-million estimated for a new facility at the Disney Animal Kingdom in Lake Buena Vista, Fla., as part of a larger $500-million project at that theme park.
Residential building, at $204.7 billion (annual rate), slipped 2% in January. The retreat came as the result of a 6% decline for single-family housing, which has now settled back for three months in a row. The January single-family decline was widespread geographically, with this pattern for the five major regions relative to December—the South Central, down 13%; the Northeast and West, each down 6%; the Midwest, down 3%; and the South Atlantic, down 2%.
Murray noted, “Harsh weather conditions in January played some role in the sluggish single-family performance, in combination with the recent pickup in mortgage rates and the tight lending environment as it relates to first-time homebuyers. Still, it’s expected that single-family construction should soon regain upward momentum, given the very low inventory of new homes for sale and what’s anticipated to be a strengthening economy and jobs picture.”
Multifamily housing in January grew 12%, staying on the broad upward track that began back in 2010. Large projects that supported the January increase were led by a $400-million condominium and apartment building in New York City, as the metropolitan area continues to see very large multifamily projects reach groundbreaking. Other large multifamily projects reported as January starts were located in Washington, D.C. ($90 million), Miami ($69 million), Minneapolis ($54 million), and Dallas ($50 million).
Nonbuilding construction in January plunged 32% to $123 billion (annual rate), following its 40% surge in December. New electric utility work dropped 61% from the elevated pace witnessed in December, returning to the downward path that was present for much of last year. Although January did include the start of an $800-million natural gas-fired power plant in Pennsylvania, this was not enough to avert the category’s steep drop for the month.
The public-works sector overall in January was down 25%, with declines across most of the project types. While January did include the start of a $153-million highway paving project in Texas and the $126-million deck replacement of the Pulaski Skyway in New Jersey, highway and bridge construction for the month fell 35%.
Other January declines were reported for river-harbor development, down 26%; miscellaneous public works (sitework, mass transit and pipelines) down 13%; and water supply systems, down 5%. Sewer construction was the one public works category to register an increase in January, rising 21%, with the lift coming from such projects as a $173 million sewer tunnel in Hawaii.
The 5% decline for total construction starts on an unadjusted basis for January 2014 relative to January 2013 was due to this performance by sector—nonresidential building, down 6%; residential building, up 8%; and nonbuilding construction, down 19%.
By geography, total construction starts for January 2014 relative to January 2013 showed declines in four of the five major regions—the West, down 15%; the South Atlantic, down 9%; the South Central, down 5%; and the Midwest, down 3%. The Northeast was the only region to register a year-over-year gain for January 2014, advancing 15%.
A useful perspective can be obtained by looking at 12-month moving totals, in this case the 12 months ending January 2014 versus the 12 months ending January 2013, which lessens the volatility present in one-month comparisons.
For the 12 months ending January 2014, total construction starts were up 5%, due to this pattern by sector—nonresidential building, up 6%; residential building, up 22%; and nonbuilding construction, down 13%. By geography, the 12 months ending January 2014 showed the following behavior for total construction starts—the Northeast, up 16%; the Midwest and West, each up 9%; the South Central, up 2%; and the South Atlantic, down 5%.