Nonresidential building in July increased 2 percent to $194.0 billion (annual rate). The commercial categories as a whole bounced back 12 percent in July, after retreating by the same percentage amount in June.
Office construction climbed 7 percent in July, reflecting groundbreaking for several noteworthy projects. These included the $232 million Bridgestone Americas office tower in Nashville, the $150 million Seaport Tower in Boston, a $100 million data center in Lowell, Mass., and a $100 million portion of the Toyota Corporate Campus in Plano, Texas.
“During the first half of 2015, office construction appeared to level off after its substantial 35 percent gain in 2014,” noted Murray. “On the positive side, office vacancy rates continued to recede through this year’s second quarter, the volume of office construction is still quite low by historical standards, and the July pickup in construction starts may well be an indication of renewed growth to come.”
Store construction in July improved 6 percent, helped by the start of the $40 million Wade Park Shopping Center in Frisco, Texas. Warehouse construction in July rebounded 28 percent after a weak June, and included groundbreaking for a $48 million Home Goods distribution center in Tucson, Ariz.
Hotel construction, which has been the one commercial property type to register healthy year-to-date percentage growth, slipped 4 percent in July. The latest month still included the start of several large hotel projects, such as the $79 million phase 2 of the Kalahari Resort and Water Park in Pocono Manor, Pa., the $76 million renovation to the Atlanta Marriott Marquis Hotel in Atlanta, and the $75 million hotel portion of the $175 million Hilton Statler Hotel and Residences in Dallas.
New manufacturing plant construction starts were generally subdued in July, falling 39 percent from June, and substantially lower than the elevated amounts back in February and April that featured the start of several huge petrochemical plants.
The institutional building group in July eased back 1 percent, receding for the second month in a row after improved activity earlier in 2015. The educational facilities category dropped 20 percent after strengthening during the previous three months. Even with the decline, July included the start of such projects as a $162 million research and development building in Cambridge, Mass., and a $112 million elementary and middle school campus in Seattle.
Healthcare facilities in July fell 15 percent, maintaining the up-and-down pattern that’s been present in 2015, even with the July start of a $250 million hospital tower in Provo, Utah.
The smaller institutional categories all registered gains in July. Transportation-related buildings jumped 120 percent, helped by the start of a $200 million rail service facility in Croton On Hudson, N.Y. The amusement and recreational building category climbed 49 percent, helped by the start of a $130 million student center at the University of Kentucky in Lexington, Ky., and a $123 million music hall renovation in Cincinnati.
Both the public buildings category and churches rebounded from very weak activity in June, posting respective gains of 58 percent and 32 percent. The public buildings category was supported by the July start of a $275 million detention center in Indio, Calif.