Nonresidential construction planning activity declined in November, marking the third consecutive month of cooling, according to Dodge Construction Network.
The Dodge Momentum Index, a benchmark that measures nonresidential construction planning, dropped 2.3% in November. A 4.6% drop in commercial activity caused most of that decrease, while a 2.5% increase in institutional planning partially offset the decline, according to the report.
Slower planning for data centers, offices, warehouses and retail projects contributed to the commercial sector’s downturn in November, while education projects fueled institutional growth. The institutional segment has now grown in five of the past six months, according to Dodge.
“Throughout 2024, we’ve seen robust growth in nonresidential planning activity — but labor shortages and high construction costs have prevented those projects from moving through the planning process at a normal pace,” said Sarah Martin, associate director of forecasting at Dodge Construction Network. “Uncertainty over new tariff and immigration policies under President-elect Trump’s administration may also generate some pause with developers, although it’s a bit too early to tell if that’s the primary factor here.”
From a year-over-year perspective, the index remains 12% higher than November 2023 levels. Commercial planning increased 13% over that time period, while institutional planning jumped 8%.
However, data centers continue to play an outsized role in this growth since 2023. Without their inclusion, commercial planning would have tumbled 6%, and the overall DMI would have ticked down 1%, according to Dodge.
Nevertheless, Martin continues to expect a rebound in activity. She said easing monetary policy will eventually help alleviate the backlog of projects throughout 2025 and ultimately spur more demand for construction in the coming months.
Seventeen projects valued at $100 million or more entered planning in November. Major commercial projects included:
- The $350 million Bally’s hotel tower and casino in Las Vegas.
- A $312 million Accokeek data center in Stafford, Virginia.
The largest institutional projects to enter planning included:
- A $465 million student dormitory at UC Berkeley, California.
- The $323 million intensive treatment tower at Texas Health Presbyterian in Plano, Texas.
