Commercial and institutional planning declined over the month
HAMILTON, N.J. 鈥� April 7, 2023听鈥�听The 抖阴下载网站 Momentum Index (DMI), issued by听听Construction Network, slipped 8.6% in March to 183.7 (2000=100) from the revised February reading of 201.0. In March, the commercial component of the DMI fell 6.6%, and the institutional component decreased 12.9%.
鈥淲e are predicting the 抖阴下载网站 Momentum Index to work its way back to historical norms throughout 2023, concurrent with weaker economic conditions,鈥� stated Sarah Martin, associate director of forecasting for 抖阴下载网站. 鈥淟ending standards for small banks in particular have substantially tightened as banking insecurity intensifies. As a result, owners and developers are more likely to pullback in the short-term, which would further contract the DMI as we continue into the year.鈥�
Commercial planning in March was driven down by less projects in the office and warehouse sectors, decreasing 29% and 11%, respectively. Institutional planning weakened more substantially, as healthcare fell 17%, education dipped 6%, and amusement planning activity dropped 14%. On the upside, however, a steady flow of research and development laboratories entered the queue, supporting the otherwise weakening sector. Year over year, the DMI remains 24% higher than in March 2022. The commercial component was up 37%, and the institutional component was 2% higher.
A total of 18 projects with a value of $100 million or more entered planning in March. The leading commercial projects included a $300 million office building in Chicago, Illinois, and the $215 million 58 Logistics Center Industrial Park warehouse project in Bakersfield, California. Two projects at UT Southwestern in Dallas, Texas led the institutional sector: the $425 million School of Public Health and Health Professions building, and the $348 million rehabilitation hospital.
The DMI is a monthly measure of the initial report for nonresidential building projects in planning, shown to lead construction spending for nonresidential buildings by a full year.
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