The Dodge Momentum Index moved lower in August, falling 2.4% to 129.1 (2000=100) from its revised July reading of 132.2. 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 decline in August can be attributed to an 8.7% drop in the commercial component of the Momentum Index, while the institutional component rose 7.3%. The commercial component has seen a steep rise over the past year as large projects – particularly office buildings – entered the planning cycle. The August retreat for the commercial component brings planning activity back to a level more consistent with a sustainable pace of development.
In August, eight projects entered planning each with a value of $100 million or more. For the institutional building sector, the leading projects were the $230 million University of New Mexico hospital replacement project in Albuquerque, N.M. and a $218 million high school in Aledo, Texas. The leading commercial building projects were the $205 million Niagara Falls Grand Hotel in Niagara Falls, N.Y. and a $178 million Amazon fulfillment center in Salem, Oreg.