Multifamily Development Begins Tumbled by Fifty-4 % in September Based on Newest Dodge Knowledge Market Index Report

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Multifamily Construction Starts Tumbled by Fifty-Four Percent in September According to Latest Dodge Data Market Index Report

HAMILTON, NJ – Total housing starts declined 18% in September to a seasonally adjusted annual rate of $ 667.7 billion, essentially reducing August earnings. While part of this decline is certainly due to several large projects starting in August, the decline in activity resulted in total housing starts falling below June and July levels. Non-residential start-up decreased 24% while residential buildings fell 21% over the month. Housing starts were 5% lower than in August.

Since the beginning of the year over a period of nine months, total housing starts have decreased by 14% compared to the same period in 2019. Non-residential housing starts decreased by 26% and non-built buildings decreased by 18%, while housing starts increased by 1%. In the 12 months to September 2020, housing starts decreased by 8% compared to the 12 months to September 2019. Housing starts for non-residential buildings were 19% lower and housing starts for non-buildings were 11% lower, while housing starts for residential buildings rose 4% in the last 12 months in September 2020. In September, the Dodge Index fell 18% from 173 in August to 141 (2000 = 100). The Dodge Index in September fell 23% year over year and 21% below pre-February pandemic levels.

"That the construction starts took a significant step back in September is disappointing, but not surprising either," said Richard Branch, chief economist at Dodge Data & Analytics. “The economic recovery has lost momentum and is strained as consumer and business support through expanded unemployment insurance benefits and the paycheck protection program has expired. The worsening budget crisis for state and local areas has also slowed the growth in public project starts, especially given the somewhat uncertain outlook for federal infrastructure programs. The road to recovery will continue to be bumpy and full of potholes until a vaccine is developed and widely used in the US. "

Non-building construction fell 5% in September to a seasonally adjusted annual rate of $ 176.3 billion. Freeway and bridge starts increased 10% for the third month in a row, while utility / gas plant starts increased 21%. However, public environmental works and various non-construction starts each lost 26% over the month.

The largest non-construction project to break the ground in September was the $ 1.6 billion Guernsey Power Plant in Pleasant City, OH. Also on stream were the $ 727 million Seminole Electric 1,122 MW natural gas power plant in Palatka, FL, and the $ 330 million fluid expansion and treatment facility in Chino, California.

In the first nine months of the year, total housing starts decreased by 18%. Starts in the motorway and bridge category increased 2%, while environmental public works decreased 10%, various non-buildings decreased 33% and the utility / gas facilities category was 43% lower. Based on the rolling total of 12 months, total housing starts decreased by 11% compared to the 12 months ended September 2019. Starts in the road and bridge category were down 1% while utility / gas starts were down 21%. Housing starts for environmental public works decreased 6% in the 12 months to September 2020, and housing starts in the miscellaneous non-buildings category were 22% lower.

Non-residential buildings Launches were down sharply in September, falling 24% to $ 177.4 billion. In detail, there was little good news: institutional launches fell 8%, production launches by 48%, and commercial launches by 36%. Only two building types saw growth in September – retail and public buildings.

The two largest non-residential construction projects that broke the ground in September were the second phase of the Iceberg Towers in Burbank, California, valued at $ 330 million and the mixed-use East Market complex, valued at $ 330 million. Dollars in Philadelphia, PA. These projects were followed by the first phase of the Moffitt Cancer Center Hospital in Tampa, FL for $ 296 million.

For nine months, housing starts for non-residential buildings have fallen by 26% since the beginning of the year. Commercial launches were down 27% while institutional launches were 18% lower. Production starts were down a painful 56% compared to the first nine months of 2019. In the twelve months to September 2020, housing starts for non-residential buildings decreased by 19%. Institutional starts were 16% lower, commercial starts were 19% lower, and production starts were down 30% in the 12 months to September 2020.

Residential building Takeoffs lost 21% in September, falling to a seasonally adjusted annual rate of $ 314.0 billion. Single family starts fell 6% in the month, while multi-family starts fell 54%.

The two largest apartment buildings to break the ground in September were the $ 130 million AJ Railyards Mixed Use building in Sacramento, California and the $ 130 million Sage Valley Apartments in West Valley City, UT. The $ 125 million Avenir Mixed Use building in Jersey City was the next largest project to break new ground.

In the first nine months of 2020, construction starts for residential houses were 1% higher than in the same period in 2019. The number of single-family starts rose by 6%, that of multi-family starts by 12%. In the 12 months that ended in September, total starts in residential areas were 4% higher than in the 12 months to September 2019. Single-family starts increased by 7%, while multi-family starts decreased by 5%.

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