March Construction Starts Climb 5 Percent

“While the construction start statistics will frequently show an up-and-down pattern, whether month-to-month or quarter-to-quarter, the improved activity in this year’s first quarter provides evidence that the construction expansion is still proceeding,” Murray continued.  “This year’s first quarter has seen nonresidential building and public works rebound from the loss of momentum each experienced towards the end of 2016, helped respectively by the strong activity so far in 2017 for new airport terminal projects and new pipeline projects.  Nonresidential building in 2017 should be able to stay on its upward track, supported by further growth for such institutional project types as school construction.  As for public works, it’s also expected to show improvement over the course of 2017, although its prospects are less certain given its connection to legislative developments at the federal level.  This includes how Congress will deal with the continuing resolution for fiscal 2017 appropriations scheduled to expire at the end of April, and whether a new federal infrastructure program will get passed this year.”

Nonbuilding construction in March jumped 16% to $195.7 billion (annual rate), following its 35% hike in February.  The public works sector surged 33%, reflecting an 82% increase in March for the miscellaneous public works category that includes such diverse project types as site work, pipelines, mass transit, and outdoor sports stadiums.  The $4.2 billion Rover natural gas pipeline was included as a construction start in March, and is located mostly in Ohio and Michigan with smaller portions in West Virginia and Pennsylvania.  Also reported as a March start was the $2.5 billion Mariner East 2 Pipeline, located mostly in Pennsylvania with smaller portions in West Virginia and Ohio, which will transport propane and other natural gas liquids from the Marcellus Shale natural gas fields in southwestern Pennsylvania to a processing and distribution facility near Philadelphia.  The start of a $300 million stadium in Washington DC for the DC United soccer team also contributed to the substantial March increase for miscellaneous public works.  Highway and bridge construction in March edged up 1%, essentially holding at the improved volume achieved with its 38% jump in February.  Large highway and bridge projects entered as March construction starts were a $399 million bridge replacement in the Pensacola FL area, the $266 million Sixth Street Viaduct replacement in Los Angeles CA, and a $192 million highway expansion project in San Antonio TX.  River/harbor development in March advanced 32% from its lackluster February amount, while sewer construction was unchanged and water supply construction slipped 2%.  The electric utility/gas plant category in March retreated 54%, although it did include as construction starts a $300 million wind farm in Ohio and a $175 million

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