Quarry Equipment Marketplace

AUG 2017

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Page 20 QEM – Quarry Equipment Marketplace August 2017 August 2017 QEM – Quarry Equipment Marketplace Page 20 Q E M Q uarry Equipment M a r k e tpl a ce ¨ June Construction Starts Climb 4 Percent New construction starts in June grew 4 percent from the previous month to a seasonally adjusted annual rate of $679.9 billion, according to Dodge Data & Analytics. Nonresidential building increased 13 percent in June, strengthening after two months of lackluster activity, and the nonbuilding construction sector rose 8 percent with the help of elevated activity for electric utilities. However, residential building slipped 4 percent in June, as both sides of the housing market (single-family and multifamily) retreated. Since last year, total construction starts have shown an up-and-down pattern on a quarterly basis, including a 6 percent decline in the fourth quarter of 2016 which was then followed by a 7 percent increase in this year's first quarter and now a 10 percent decline in the second quarter. "A maturing construction expansion is characterized by deceleration in the overall rate of growth, that's often accompanied by up-and-down behavior on a quarterly or monthly basis," stated Robert A. Murray, chief economist for Dodge Data & Analytics. "The 11 percent to 12 percent yearly increases for total construction starts during the 2012-2015 period were followed by a 4 percent gain in 2016, and several factors suggest that 2017 should still see modest growth for the year as a whole. These factors include commercial vacancy rates that remain low as well as greater construction funding coming from the state and local bond measures passed in recent years. At the same time, it's become apparent that any impact from a new federal infrastructure program, should one get passed during the latter half of 2017, would benefit construction more in 2018 and 2019." Nonresidential Building Nonresidential building in June was $249.6 billion (annual rate), up 13 percent from May. The commercial categories as a group climbed 23 percent, led by an 83 percent surge for new office building starts. There were 8 office projects valued at $100 million or more that reached groundbreaking in June, led by a $585 million Facebook data center in the Omaha, Neb., area, the $400 million office portion of the $500 million renovation of the Willis Tower in Chicago (involving remodeling of the structure's base and observation deck), and the $334 million office portion of the $600 million Diridon Station mixed-use complex in San Jose, Calif. The other commercial categories lost momentum in June, with stores and shopping centers down 2 percent, warehouses down 19 percent, and commercial garages down 31 percent. The manufacturing building category in June increased 35 percent, lifted by the start of a $1.8 billion methane plant in Louisiana as well as groundbreaking for such projects as a $150 million pyrogenic silica plant in Tennessee and a $143 million pharmaceutical research laboratory in Missouri. The institutional categories as a group were unchanged in June compared to May. On the plus side, educational facilities rose 16 percent in June, led by the $160 million renovation of the Martin Luther King Jr. Memorial Library in Washington, D.C., a $125 million high school in Stratford, Conn., and a $114 million high school in Millville, N.J. The amusement and recreational category surged 58 percent in June, reflecting the start of the $193 million renovation of the Philips Arena in Atlanta, the $175 million casino portion of the Hard Rock Hotel and Casino renovation in Atlantic City, N.J., and the $156 million casino portion of the Seminole Hard Rock Hotel and Casino expansion in Hollywood, Fla. The public buildings category (courthouses, detention centers) and transportation terminals also contributed with June gains, rising 16 percent and 10 percent respectively. However, healthcare facilities plunged 39 percent in June, pulling back after a 40 percent hike in May. The religious buildings category also retreated in June, falling 38 percent. Nonbuilding Construction Nonbuilding construction, at $155.4 billion (annual rate), increased 8 percent in June. The electric utility/gas plant category ran counter to its generally declining trend this year, with June soaring 78 percent. Large electric utility projects included as June starts were a $1.3 billion natural gas-fired power plant in Florida, a $1.1 billion wind farm and transmission line in Colorado, and a $296 million wind farm in Texas.

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