New construction starts moved 5 percent lower in September to a seasonally adjusted annual rate of $774.1 billion, according to Dodge Data and Analytics. This marks the second consecutive monthly decline in construction starts. By major sector, nonbuilding construction fell 13 percent in September, while residential construction dropped 6 percent. On the plus side, nonresidential construction starts rose 1 percent during the month aided by the start of a large manufacturing project.

The September statistics pushed the Dodge Index lower to 164 (2000 equals 100) compared to 173 in August, marking the lowest reading for the Index since May. Despite the month’s decline, the index remains close to its 2019 average of 167.

Through the first nine months of 2019, total construction starts were 3 percent lower than 2018 due to pullbacks in both residential and nonresidential construction starts. However, nonbuilding construction starts are 4 percent higher year-to-date as a result of strong gains in electric utilities/gas plants.

“Large projects continue to make their presence felt in the monthly statistics, sometimes obscuring underlying trends,” said Richard Branch, chief economist at Dodge Data and Analytics. “Nevertheless, construction starts have certainly throttled back in 2019 due to mounting uncertainty over the country’s economic health.”

Nonbuilding construction totaled $187 billion (at a seasonally adjusted annual rate) in September, a 13 percent drop from the previous month. Starts in the miscellaneous nonbuilding category declined 32 percent from August to September, while highway and bridge starts fell 12 percent, and electric utility/gas plant starts lost 10 percent over the month. On the plus side, environmental public works (drinking water, sewers, hazardous waste, and other water resource projects) increased 12 percent in September.

The largest nonbuilding construction project to get underway in September was the $994 million Cotton Belt “Silver Line” Rail Corridor, a 26-mile rail line extending from Dallas-Fort Worth Airport in Dallas to Shiloh Road in Plano, Texas. Also starting in September was the $720 million (480 MW) Maverick Creek Wind Farm near Eden, Texas, and a $629 million reconstruction of a 5.5 mile stretch of I-75 in Troy, Mich.

Through the first nine months of 2019, nonbuilding construction was 4 percent higher than in the same period of 2018 at $151.3 billion. Starts for electric utilities/gas plants were 132 percent higher year-to-date and environmental public works were up 2 percent. Miscellaneous nonbuilding starts, however, were 24 percent lower through nine months and highways and bridges were down 7 percent.

Nonresidential building starts inched 1 percent higher in September to $287 billion (at a seasonally adjusted annual rate). The increase was a result of a 243 percent increase in manufacturing construction due to the start of a large automotive plant. Commercial construction starts fell 14 percent over the month as the office sector pulled back from a very strong level of activity during the prior month. Institutional construction starts fell 1 percent.

The largest nonresidential building project to break ground in September was a $969 million consolidated rental car facility at Los Angeles International Airport in Los Angeles. Also getting under way was the $900 million Fiat Chrysler Assembly complex in Detroit and the $750 million Exxon Polypropylene Production plant in Baton Rouge, La.

Year-to-date through September, nonresidential building starts totaled $215 billion, a 4 percent decline from the first nine months of 2018. Commercial starts were 6 percent higher pushed forward by the office, warehouse, and parking categories. Institutional construction starts were down 3 percent through nine months, with all major categories posting setbacks. Manufacturing starts were a sharp 39 percent lower year-to-date.

Residential building fell 6 percent in September to $300 billion at a seasonally adjusted annual rate. Both single family and multifamily starts fell 6 percent from August to September. The largest multifamily construction project to get underway in September was the $228 million Lakeshore East Cirrus Apartment Tower in Chicago. Also breaking ground during the month was the $192 million Greenpoint Landing in Brooklyn, N.Y., and the $150 million The Eleven Condo project in Minneapolis.

Through the first nine months of the year, residential construction starts were 6 percent lower than in the same period of 2018 at $238.3 billion. Single family starts were down 4 percent, while multifamily declined 11 percent year-to-date.