Volume 50, Issue 11 - November 2015

IndustryOutlook

ABI Bounces Back

With a positive showing in September, the Architecture Billings Index (ABI) has now seen growth in six of the last nine months, according to the American Institute of Architects (AIA).

The ABI, which reflects the approximate nine- to 12-month lead time between architecture billings and construction spending, rebounded in September with a mark of 53.7. That followed a down month in August, when the ABI sat at 49.1.

September’s score reflects an increase in design services, as any score above 50 indicates an increase in billings. The new projects inquiry index was 61.0, down from a reading of 61.8 the previous month.

September 2014 September 2015
ABI Score
55.2 53.7
New Projects Inquiry Score
64.8 61.0



Dodge Momentum Index Takes a Jump


The Dodge Momentum Index moved 5.8 percent higher in September to 133.5 (2000=100) from its August reading of 126.2. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The impetus behind September’s gain was a 12-percent increase from the previous month in institutional building planning, according to the latest Dodge report.

Planning for new institutional buildings has trended upward over the past year, although in a saw-tooth pattern, according to the report. Planning in the commercial category increased 1.8 percent in September.

Dodge Momentum Index (Year 2000=100)
  August
2015
Sept.
2015
% Change Sept.
2014
Sept.
2015
Dodge Momentum index 126.2 133.5 +5.8% 115.8 133.5
Commercial building 139.5 142.0 +1.8% 121.1 142.0
Institutional building 109.7 122.9 +12.0% 109.4 122.9
Source: Dodge Data & Analytics



New Construction Starts Slip

The value of new construction starts in September dropped 5 percent from the previous month to a seasonally adjusted annual rate of $523.7 billion, according to Dodge Data & Analytics. The Dodge Index was 111 for the month, down from 117 in August.

Both nonresidential building and housing saw decreased activity, though total construction starts on an unadjusted basis were $497.4 billion through the first nine months of 2015, up 12 percent from the same period a year ago.

Nonresidential building in September dropped 4 percent to $152.9 billion (annual rate). The institutional categories as a group fell 13 percent, as educational facilities retreated 20 percent from the elevated amount reported in August.

The commercial building group in September improved 4 percent, regaining some ground after a 24-percent plunge in August.

The 12-percent increase for total construction starts on an unadjusted basis during the first nine months of 2015 came from growth for residential building and nonbuilding construction, while nonresidential building was down moderately.

Monthly Construction Starts Seasonally adjusted annual rates, in millions of U.S. dollars
  August 2015 Sept. 2015 % Change
Nonresidential building $159,821 $152,882 -4
Residential building 265,855 236,910 -11
Nonbuilding construction 127,504 133,912 +5
Total construction $553,180 $523,704 -5

Year-to-date construction starts Unadjusted totals, in millions of dollars
  9 Mos. 2014 9 Mos. 2015 % Change
Nonresidential building $165,580 $154,188 -7
Residential building 171,408 200,227 +17
Nonbuilding construction 106,036 142,969 +35
Total construction $443,024 $497,384 +12
Source: Dodge Data & Analytics

USG
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