During the first half of 2019, six of the top 10 U.S. metropolitan markets for commercial and multifamily construction starts ranked by dollar volume registered greater activity compared to a year ago, according to Dodge Data & Analytics. Of the top 20 markets, 13 were able to register gains. At the U.S. level, the volume of commercial and multifamily construction starts during the first half of 2019 was $101.4 billion, down 6 percent from last year’s $107.4 billion.

The New York City metropolitan area, at $15.0 billion, maintained its longstanding number one ranking by dollar volume, although it settled back 8 percent from a year ago. Several very large projects had boosted New York’s first half 2018 total, including the $1.8 billion Spiral office tower in Manhattan’s Hudson Yards district. The first half of 2019 also witnessed groundbreaking for several very large projects, such as the $1.1 billion TSX Broadway Hotel project in Times Square, yet this year’s lift from very large projects was slightly less than what took place during 2018.

The Washington DC metropolitan area, at $7.1 billion, was ranked number two in terms of the dollar amount of commercial and multifamily construction starts during the first half of 2019. Soaring 50 percent compared to a year ago, the Washington, D.C., market showed the volume of office construction starts doubling in size relative to last year. Providing the boost was the $610 million Reston/Gateway office/retail development in Reston, Va., and large data center projects led by the $300 million CloudHQ facility in Ashburn, Va. The Washington, D.C., metropolitan area had $1.2 billion reported for new data center starts during the first half of 2019, the most of any U.S. metropolitan area.

Of the remaining markets in the top 10, the metropolitan areas showing growth during the first half of 2019 versus a year ago were – Boston ($3.8 billion), up 2 percent; Los Angeles ($3.8 billion), up 14 percent; Atlanta ($3.4 billion), up 69 percent; Chicago ($3.0 billion), up 0.4 percent; and Austin, Texas ($2.6 billion), up 39 percent. The remaining markets in the top 10 showing declines were – Dallas-Ft. Worth, Texas ($3.4 billion), down 7 percent; Miami ($3.1 billion), down 38 percent; and Houston ($2.5 billion), down 4 percent.

For the metropolitan areas ranked 11 through 20, the seven that registered first half 2019 gains were – Philadelphia ($2.5 billion), up 34 percent; Nashville, Tenn. ($2.2 billion), up 112 percent; Minneapolis ($1.8 billion), up 28 percent; Orlando, Fla. ($1.8 billion), up 8 percent; Portland, Ore. ($1.4 billion), up 22 percent; Cincinnati ($1.4 billion), up 130 percent; and Columbus, Ohio ($1.2 billion), up 20 percent. The three metropolitan areas reporting declines in markets ranked 11 through 20 were – San Francisco ($2.1 billion), down 24 percent; Phoenix ($1.5 billion), down 5 percent; and Seattle ($1.5 billion), down 57 percent.

The commercial and multifamily total is comprised of office buildings, stores, hotels, warehouses, commercial garages, and multifamily housing. Not included in this ranking are institutional building projects (e.g., educational facilities, hospitals, convention centers, and transportation terminals) and manufacturing buildings. At the U.S. level, the 6 percent decline for commercial and multifamily construction starts in the first half of 2019 was due entirely to a slower pace for multifamily housing, which dropped 13 percent, while commercial building held steady with its first half 2018 amount.

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“So far in 2019, multifamily housing has settled back from last year’s robust amount, although this year’s volume can still be regarded as healthy by recent standards,” stated Robert A. Murray, chief economist for Dodge Data & Analytics. “Due to the strong 2018 economy, market fundamentals for multifamily housing such as occupancies and rents strengthened, and have not yet begun to erode in a widespread manner. At the same time, there are concerns that multifamily housing is overbuilt in some markets, and the banking sector continues to take a cautious stance towards multifamily lending. As for commercial building, office construction starts in 2019 have seen modest expansion compared to last year, helped by groundbreaking for large office projects and the support coming from the continued strength of data center projects. Hotel construction has stayed close to last year’s pace, but warehouse construction has begun to slip and store construction has seen further declines. Going forward, a slowing economy would lead to more visible erosion in market fundamentals, which would contribute to a more subdued pace for commercial building starts.”

The 8 percent decline registered by the New York City metropolitan area during the first half of 2019 was the result of a 20 percent retreat for commercial building that was partially offset by a 4 percent gain for multifamily housing. Office construction pulled back 43 percent when compared to the first half of 2018 that included the $1.8 billion Spiral office tower and the $480 million addition to the Hudson Commons office building, both in or near the Hudson Yards district of Manhattan, plus the $300 million One Willoughby Square building in Brooklyn. During the first half of 2019, the largest office project entered as a construction start was a $210 million office building on W. 29th St. in Manhattan. Hotel construction fell back 21 percent in the first half of 2019, even with the start of the $1.1 billion TSX Broadway Hotel which involves the renovation of the Palace Theater in Times Square. The first half of 2018 had included the start of 6 hotel projects valued each at $100 million or more, led by the $300 million Tribeach Holdings Hotel in Times Square. Warehouse construction was able to post a first half 2019 gain relative to a year ago, rising 86 percent with the largest project being a $182 million distribution center in the Bronx. The 4 percent gain for multifamily housing during the first half of 2019 followed a 4 percent increase for the full year 2018, as multifamily projects continue to move forward at a healthy pace. There were 38 multifamily projects valued each at $50 million or more that were entered as construction starts during the first half of 2019, led by the $700 million Hunters Point South multifamily complex (phase 2) in Long Island City, the $640 million Pacific Park apartment building in Brooklyn, and a $200 million apartment building in the Bronx.

The 50 percent jump for the Washington, D.C., metropolitan area during the first half of 2019 reflected a 96 percent surge for new commercial building starts combined with a 7 percent gain for multifamily housing. Office construction climbed 102 percent, pushed upward by groundbreaking for the $610 million Reston/Gateway office/retail development in Reston, Va., the $300 million Avocet Tower in Bethesda, Md., and the $188 million Capital One office building in Fairfax, Va. A strong dollar amount of data center starts, valued at $1.2 billion during the first half of 2019, also boosted the office total for the Washington, D.C., market. The largest data center projects entered as construction starts included two in Ashburn, Va., the $300 million CloudHQ data center and the $135 million RagingWire data center, plus two in Manassas, Va., valued respectively at $258 million and $135 million. Gains were also reported during the first half of 2019 for stores, warehouses, hotels, and commercial garages, relative to subdued activity for these four structure types during the same period a year ago. The 7 percent increase for multifamily housing during the first half of 2019 followed a 27 percent hike for the full year 2018. The largest multifamily projects that reached groundbreaking during the first half of 2019 were the $207 million multifamily portion of the $250 million Eckington Yards/Flower Center mixed-use complex in Washington, D.C., and the $144 million multifamily portion of the $240 million Hoffman Town Center mixed-use building in Alexandria, Va.

The Boston metropolitan area registered a 2 percent gain for commercial and multifamily starts during the first half of 2019, with commercial building up 72 percent while multifamily housing dropped 41 percent. The commercial building segment was lifted by a 109 percent rise for new office building starts that included three large projects in Boston – the $300 million One Post Office Square addition/renovation, the $225 million Amazon at Seaport Square building, and the $170 million Boston Garden Office Tower (phase 3). Large office projects also reached groundbreaking in Cambridge ($155 million for the office portion of a $362 million office/research lab complex), Somerville ($125 million), and Lexington ($76 million for the office portion of a $200 million office/research lab complex). Hotel construction increased 212 percent from a weak amount a year ago, helped by the start of a $34 million Staybridge Suites hotel in Revere. Store construction improved 2 percent, while warehouse construction fell 11 percent. The 41 percent decline for multifamily housing in the first half of 2019 followed strong activity during 2018, when multifamily housing soared 73 percent for the full year. There were four multifamily projects valued each at $50 million or more that reached groundbreaking during the first half of 2019, led by the $141 million multifamily portion of the $225 million Red Line Station mixed-use complex in Quincy.

Commercial and multifamily construction starts in the Los Angeles metropolitan area advanced 14 percent during the first half of 2019, with multifamily housing up 21 percent while commercial building grew 8 percent. The 21 percent gain for multifamily housing followed a 7 percent slide for the full year 2018, with much of this year’s boost coming from the $511 million multifamily portion of the $950 million Grand Avenue mixed-use complex in Los Angeles. Other large multifamily projects that reached groundbreaking during the first half of 2019 included the $300 million 2900 Wilshire Blvd. Apartments and the $150 million multifamily portion of the $185 million JMB Century City high-rise tower, both in Los Angeles. The 8 percent improvement for commercial building was led by a 284 percent jump for hotel construction, reflecting the $220 million hotel portion of the Grand Avenue mixed-use complex and the $115 million Radisson Blu Hotel in Anaheim. Warehouse construction climbed 59 percent during the first half of 2019, but decreased activity compared to last year was reported for office construction, down 61 percent; and store construction, down 6 percent.

The Atlanta metropolitan area registered a 69 percent jump for commercial and multifamily construction starts during the first half of 2019, showing renewed strength after activity settled back 13 percent for the full year 2018. The commercial building segment advanced 129 percent from the same period a year ago, with new office construction starts up 358 percent. The strong performance for office construction came as the result of four large projects located in Atlanta – the $550 million Norfolk Southern Headquarters building, the $314 million office portion of the $470 million 40 W. 12th Autograph building, the $150 million One Phipps Plaza building, and the $106 million office portion of the $264 million Thyssenkrupp Headquarters and Innovation Complex. Hotel construction starts rose 60 percent during the first half of 2019, warehouse construction increased 9 percent with the help of the $100 million Shugart Farms distribution center (phase 2), while store construction was flat. Multifamily housing during the first half of 2019 increased 3 percent, showing slight improvement after weaker activity during 2018 when activity dropped 21 percent for the full year. There were three multifamily projects valued each at $50 million or more that reached groundbreaking during the first half of 2019 – the $93 million Ascent Peachtree Apartments in Atlanta, the $70 million Novel Upper Westside Apartments in Atlanta, and the $58 million Alexan Gateway Apartments in Avondale Estates.

The 7 percent slide for commercial and multifamily construction starts in the Dallas-Ft. Worth, Texas, metropolitan area during the first half of 2019 was due to a 22 percent downturn for multifamily housing, which is now pulling back after the substantial 29 percent hike for the full year 2018. There were four multifamily projects valued each at $50 million or more that reached groundbreaking during the first half of 2019 – the $73 million multifamily portion of the $84 million The Crossing mixed-use development in Dallas, the $73 million Sovereign at Twin Creeks Apartments in Allen, the $65 million Cooper Apartments in Ft. Worth, and the $53 million Kirby Apartments in Frisco. In contrast, during the first half of 2018 there were eight multifamily projects valued each at $50 million or more that reached groundbreaking. The commercial building segment was able to register a 4 percent gain during the first half of 2019, aided by a 51 percent increase for office construction starts. Large office construction projects that reached groundbreaking during the first half of 2019 were led by the $225 million Charles Schwab office complex (phase 2) in Westlake, as well as by two large data centers – the $225 million Google data center in Midlothian and the $138 million Equinix data center in Dallas. Hotel construction rose 21 percent during the first half of 2019, but declines were reported for stores, down 29 percent; and warehouses, down 36 percent.

The Miami metropolitan area experienced a steep 38 percent drop for commercial and multifamily construction starts during the first half of 2019. Multifamily housing plunged 42 percent, following very strong activity during 2018 when activity climbed 43 percent for the full year. There were seven multifamily projects valued each at $50 million or more that reached groundbreaking during the first half of 2019, with the largest being the $145 million multifamily portion of the $300 million One West Palm mixed-use complex in West Palm Beach. In contrast, there were 15 multifamily projects valued each at $50 million or more that reached groundbreaking during the first half of 2018, led by the $300 million One River Point condominium building in Miami. The commercial building segment also weakened during the first half of 2019, falling 32 percent. Double-digit declines were reported for hotels, warehouses, and stores, although the office building category managed to post a 48 percent gain. Large office projects that reached groundbreaking during the first half of 2019 were led by two projects in Miami valued respectively at $98 million and $81 million, plus the $49 million office portion of the One West Palm mixed-use complex in West Palm Beach.

Commercial and multifamily construction starts in the Chicago metropolitan area increased a slight 0.4 percent during the first half of 2019, as a 42 percent rebound for multifamily housing balanced a 22 percent drop for commercial building. There were four multifamily projects valued each at $50 million or more that reached groundbreaking during the first half of 2019, led by the $653 million multifamily portion of the $850 million One Chicago Square mixed-use complex in Chicago. The commercial building downturn reflected a 35 percent decline for office construction, compared to a strong first half of 2018 that included the $665 million 110 N. Wacker Drive office tower. The largest office projects entered as a first half 2019 construction start were located in Chicago – the $70 million 167 Green Street office building, a $70 million office building alteration, and a $70 million data center. On the plus side for commercial building, warehouse construction starts were up 134 percent during the first half of 2019, aided by the start of a $95 million logistics park in Kenosha, Wis.

The Austin, Texas, metropolitan area climbed 39 percent during the first half of 2019, which followed a strong 20 percent increase for commercial and multifamily construction starts for the full year 2018. Commercial building soared 72 percent during the first half of 2019 compared to a year ago, lifted by a 194 percent jump for office construction. Large office projects that reached groundbreaking during the first half of 2019 were led by the $375 million Block 185 redevelopment project, the $263 million George H.W. Bush office building, and the $180 million Oracle office building. Constraining the first half 2019 improvement for commercial building were declines for warehouses and hotels. Multifamily housing during the first half of 2019 edged up 1 percent, which was relative to generally stronger activity during 2018 with a full year gain of 19 percent. There were four multifamily projects valued each at $50 million or more that reached groundbreaking during the first half of 2019 – the $150 million Alexan on 11th Apartments, the $140 million Red River apartment building, the $60 million The Standard student housing building, and the $55 million The Grove at Shoal Creek Block 4 Apartments.

The Houston metropolitan area registered a 4 percent decline for commercial and multifamily construction starts during the first half of 2019. Multifamily housing pulled back 26 percent, following the sharply stronger dollar amount of multifamily starts during 2018 with a full year increase of 249 percent. There were three multifamily projects valued each at $50 million or more that reached groundbreaking in Houston during the first half of 2019 – the $200 million The Preston apartment tower, the $120 million San Felipe apartment tower, and the $85 million Novel River Oaks Apartments. Commercial building advanced 8 percent during the first half of 2019 compared to a year ago, helped by gains for office construction and warehouses. The office category climbed 29 percent, with the lift coming from the $350 million Hines office tower in Houston. Warehouse construction grew 21 percent, supported by the start of a $130 million Dollar Tree distribution center in Rosenberg, an $85 million Costco distribution center in Katy, and a $70 million distribution center near George Bush Intercontinental Airport.