Planning Cools Again on Slower Data Center Growth
Labor shortages and high construction costs have prevented projects from moving through the pipeline at a normal pace, according to Dodge Construction Network.
December 9, 2024
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%.
About the Author
You May Also Like