Quarry Equipment Marketplace

MAY 2016

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Page 21 of 51

By Mark S. Kuhar A t a seasonally adjusted annual rate of $660.5 billion, new construction starts in March receded 1 percent from February's pace, according to Dodge Data & Analytics. Total construction starts had jumped 13 percent in February, led by a huge gain for the electric utility and gas plant category. While the dollar amount of electric utility and gas plant starts fell considerably in March, accompanied by a pullback for public works – highways retreated 8 percent – the latest month featured a substantial increase for nonresidential building as this sector is providing more evidence that it's regaining upward momentum. In addition, residential building in March registered moderate growth, helped by the continued strength for multifamily housing. "While March construction activity was down slightly from February, it stayed above the lackluster performance witnessed during the second half of last year that continued through January," stated Robert A. Murray, chief economist for Dodge Data & Analytics. "What's noteworthy about the March report is the renewed strength shown by nonresidential building, and in particular its institutional building segment. Nonresidential building had settled back 5 percent in 2015 after its 24 percent surge in 2014, refecting not only a steep 36 percent plunge for manufacturing plant construction but also a slight 1 percent decline for institutional building. The strength shown by institutional building in March provides some indication that it's beginning to shift back into expansion mode, helped by growth for educational facilities as well as by the start of several large transportation terminal projects. Assuming this pattern gets repeated over the course of 2016, it would be an important factor behind nonresidential building reestablishing an upward trend." Nonresidential Building Nonresidential building in March climbed 23 percent to $228.1 billion (annual rate), strengthening for the second month in a row after February's 5 percent gain. The institutional building group in March soared 44 percent, with most of the structure types reporting growth. Leading the way was the transportation terminal category, up 339 percent, as it was lifted by the start of two very large projects – $663 million for work on the rail terminal caverns at Grand Central Station in New York and $537 million for the new North Terminal building at Louis Armstrong International Airport in New Orleans. Other large transportation terminals included as March starts were the $132 million Andrews Federal Center bus garage in the Washington, D.C., area and the $112 million Terminal 4 expansion at Fort Lauderdale-Hollywood, Fla., International Airport. Educational facilities, the largest nonresidential building category by dollar volume, advanced 20 percent in March. Several large university buildings reached groundbreaking, including a $131 million research building at the University of Kentucky in Lexington ,Ky., and the $110 million seismic replacement of Tolman Hall at the University of California Berkeley. The amusement and recreational category had a strong March, rising 38 percent with the boost coming from the $284 million casino portion of the $630 million Montreign Resort and Casino in Kiamesha Lake, N.Y., and the $192 million casino portion of the $500 million MGM Resort and Casino in Springfeld, Mass. The public buildings category and healthcare facilities rebounded from weak February amounts, rising 55 percent and 53 percent respectively. Church construction, sliding 54 percent in March, ran counter to the general upward trend for institutional building. The commercial categories as a group increased 5 percent in March, refecting a mixed pattern by project type. Hotel construction rose 47 percent, lifted by the $332 million hotel portion of the Montreign Resort and Casino, and support was also provided by the $78 million hotel portion of the Springfeld, Mass., MGM Resort and Casino. Other large hotel projects included as March starts were the $285 million expansion of the Pechanga Resort and Casino in Temecula, Calif., and the $217 million Turnberry JW Marriott Hotel in Nashville. Store construction in March increased 19 percent, refecting the $140 million renovation of the Fashion Outlets of Philadelphia mall in Philadelphia and the $116 million retail space expansion at TD Boston Garden in Boston. On the negative side, offce construction retreated 27 percent in March after its 26 percent hike in February. Despite the decline, several large offce projects were included as March starts, such as $293 million for work at the Toyota Corporate Campus project underway in Plano, Texas, and a $131 million offce building in Atlanta. March Construction Eases Back One Percent Page 20 QEM – Quarry Equipment Marketplace May 2016

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