New construction volume will continue to expand next year but at a more moderate rate than this year’s, Dodge Data & Analytics says in its new forecast.
The Dodge forecast, released on Oct. 30, says construction starts will rise 6% in 2016 to $712 billion. That compares with an estimated 13% jump this year.
Dodge foresees a 16% jump in 2016 for new residential buildings and a 9% increase for the nonresidential building sector.
On the down side, Dodge says non-building starts will drop 14%, reflecting a downturn in electric power and natural gas plant construction.
Robert Murray, Dodge D&A chief economist, said in a statement, “For 2016, the economic environment should support further growth for the overall level of construction starts.”
Noting construction’s strong performance in 2015, Murray said, “Much of this year’s lift has come from nonbuilding construction, reflecting the start of several massive liquefied natural gas terminals in the Gulf Coast region, as well as renewed growth for new powerplant starts.”
Looking at key segments’ prospects for 2016, Dodge expects commercial buildings to grow 11% and multifamily housing 7%, in dollar volume.
It also says institutional buildings will move up 9%, compared with an expected 6% gain in 2015, with increases in K-12 school projects backed by voters’ approval of school construction bond issues.
Manufacturing facilities will edge down 1% next year after plummeting 28% in 2015, because of a drop in petrochemical plant work.
Dodge sees the 2016 public works market as flat with this year’s level, with a small decline in highway and bridge projects and an upturn in environmental public works.
(ENR was part of Dodge Data & Analytics until July, when it was acquired by BNP Media.)
September Construction Starts Down From August But Rise Year Over Year (enr.com 10/19/2015) [subscription]