Construction News Tracker is presented by Caterpillar and produced by ForConstructionPros.com.
Dodge Data is reporting that analysis of the first half of this year shows a mixed bag for U.S. commercial and multifamily housing starts. The volume of 101.4 billion was 1% less than the identical time frame in 2017 but 2% greater than the period in 2016. Multifamily starts kept the volume loss to a minimum by balancing a nearly equal downturn in commercial starts. Dodge Chief Economist Robert Murray says the multifamily market was resileint after the 2017 downturn, which has led banks to ease up on their lending practices.
Meanwhile the Wall Street Journal in recent editions has questioned the housing market mobility as Dodge Data reported a 9% slump in July starts. It claims an analysis shows investment declining in four of the past five quarters. Price Waterhouse Cooper's economists say that while the month of June decline appears to be an anomaly, July downward results in the market appears to be a trend — something not many economists have sided with.
The National Association of Home Builders Wells Fargo Housing Affordability Index shows that rising home prices and interest rates have pushed the category into a 10-year low over the first half of 2018. NAHB says in all 57.1% of homes sold between April and June were affordable compared with 61.6% sold in the first quarter of the year. The national medium home price has surged from $252,000 in the first quarter to $265,000 in the second quarter — the highest ever — while average mortgage rates rose by 30 basis points at 4.67%. None the less, says NAHB Chief Economist Robert Dietz, rising demand will continue to fuel the industry in the remainder of 2018.
It's now been 22 months of consecutive cost increases for construction, according to IHS Market and Procurement Executives Group. Although nine points lower than July, August came in at 58.9 on the index, which simply means costs continued to rise, though at a slower pace. Materials and equipment notched prices slightly lower at 60.7, an index loss of 8.8 points. The construction cost indexes were lower in 10 of 12 categories in August. Trade uncertainty and supply chain disruptions are the most concern.
The Association of Equipment Manufacturers (AEM) has begun a national campaign to pressure President Trump and the Congress to prioritize rebuilding the nation's infrastructure. Mission Not Accomplished is the theme of the campaign, which points out there are 1.3 million Americans in the equipment building industry eager to get the infrastructure effort underway. A TV ad along with print, digital and social media ads are running in select markets as well as Washington D.C. AEM President Dennis Slater says the effort is to get the politicians to follow through on earlier promises to rebuild the nation.
Federal officials including National Intelligence Director Dan Coats recently visited the St. Louis site of their newest Geospatial facility now under construction. Located north of the city, thus far 97 acres has been cleared of 137 buildings to make way for construction of the $1.7 billion federal complex. There's not much detail about what the facility is designed for except the fact were talking about the nation's key spy agency.
St. Clair, MI, was the location recently for groundbreaking of a $1 billion gas fired power plant. The Blue Water Energy Center near East China Township is designed to power 850,000 homes and comes with 500 construction jobs. Blue Water replaces three coal fired generators and will be 70% cleaner and 40% more efficient when completed and operational. The 1,150 megawatt operation will produce 70% less carbon emissions when it goes online in 2022.
A stretch of California Highway One at Big Sur has been rebuilt and opened to traffic following a massive mudslide in September 2017. The slide that hit Mud Creek moved 75 acres of land, buried the roadway perched atop the mountain and managed to create 16 new acres of coastline. The slide area was about nine miles north of the Monterey San Luis Obispo county line along the pcturesque scenic highway. It cost CALTRANS about $40 million to rebuild the road that sent five million cubic yards of rock and dirt tumbling into the ocean.
The National Transportation Safety Board has released a preliminary report regarding collapse of the pedestrian bridge at Florida International University March 10th. The federal agency also released pictures that showed cracks in the structure were far more prevalent than thought before the collapse occurred. One of four large cracks in the bridge deck was over 3.5 inches deep, far wider and deeper than expected. The NTSB said it found no problems with the concrete or rebar used in the pedestrian cross over, and drew no conclusions regarding cause. As yet the mystery continues into the genesis of the failure.
Finally in closing, getting something done is an accomplishment; getting something done right is an achievement.
This is Construction News Tracker looking over the industry that makes the world a better place, presented by Caterpillar and produced by ForConstructionPros.com.