Dodge Momentum Index Declines in October

NEW YORK, N.Y. — The Dodge Momentum Index fell 4.8 percent in October to 125.2 (2000=100) from its September reading of 131.5.

The 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 October decline for the index nearly reverses September's large gain (up 5.2 percent), which had been fueled by a sharp jump for institutional building projects at the planning stage.

The institutional building sector so far in 2015 has trended upward, but with some volatility on a month-to-month basis that's reminiscent of this sector's upturn in the early stages of its prior recovery back in the previous decade.

In October, planning for institutional building projects dropped 4.5 percent after surging 10.6 percent in September, while commercial building projects retreated 5 percent after September's 1.7 percent gain. Compared to the same month a year ago, the momentum index in October was still up 4.8 percent, with increases for both the commercial and institutional sectors, up 6.3 percent and 2.6 percent respectively.

There were a total of eight projects entering planning in October with a value that exceeded $100 million. For the commercial building sector, the leading projects were a $500-million mixed-use facility at the Mall of America in Minneapolis, Minnesota and a $151-million warehouse and distribution complex in Newark, New Jersey. For the institutional building sector, the leading projects were a $350-million hospital in Washington, D.C. and a $110-million hospital in Bethesda, Maryland.