{"id":9806,"date":"2022-06-03T13:44:00","date_gmt":"2022-06-03T20:44:00","guid":{"rendered":"https:\/\/essential.construction\/news\/?p=9806"},"modified":"2022-06-03T13:44:00","modified_gmt":"2022-06-03T20:44:00","slug":"northeast-construction-starts-slow-following-rebound-last-year","status":"publish","type":"post","link":"https:\/\/essential.construction\/news\/northeast-construction-starts-slow-following-rebound-last-year\/","title":{"rendered":"Northeast construction starts slow following rebound last year"},"content":{"rendered":"

This story is the third in a series looking at the health of the construction industry in regions throughout the country. Click here for the first article<\/a>\u00a0and here for the second<\/a>.<\/em><\/p>\n

Total construction starts in the U.S. Northeast region in 2021 improved 20%, ahead of the national start growth, according to a Dodge Construction outlook webinar. But activity has slowed in the first part of 2022.<\/p>\n

\u201cNortheastern states will have to continue grappling with the wide array of headwinds that will remain present in 2022 \u2014 high inflation, supply chain issues, COVID-19 variants and the rather delicate consumer and investor sentiment,\u201d said Sarah Martin, senior economist at Dodge. \u201cSo, we could see a slower than projected growth across the Northeast, especially as the risk of recession increases.\u201d<\/p>\n

Education and healthcare construction starts led the nonresidential category in the Northeast region, which consists of Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island and Vermont. That mirrors construction trends in other U.S. regions, like the West<\/a>, where education starts led in the region too.<\/p>\n

For 2022, Dodge forecasts education starts in the Northeast region will reach $14.9 billion, a 19% increase from a year ago. Along with campus projects, the education category also includes research labs, according to Dodge. Pharmaceutical labs, on the other hand, are included in the manufacturing category, another growth sector in the region.\u00a0<\/p>\n

\u201cEducation leads the pack as the largest sector in the Northeast,” said Martin. “Education starts are expected to continue to improve this year as more students return to classrooms on both the K-12 side and in colleges and universities.\u201d<\/p>\n

\n
<\/div>\n<\/div>\n

Optional Caption
\nSebastian Obando\/Construction Dive, data from Dodge Data & Analytics<\/p>\n

For example, some major education projects include the $388 million Rutgers University Cancer Institute and the $250 million Lincoln Street lab office and parking garage in Boston.\u00a0<\/p>\n

\n
Largest Northeast starts October 2021 through March 2022<\/h6>\n

Project
\nType
\nLocation
\nStart month
\nValue
\nVineyard Wind 1 Energy Development
\nEnvironmental
\nBarnstable, Massachusetts
\nNovember 2021
\n$1.6 billion
\nJFK Airport Terminal 4 Expansion
\nTransportation
\nQueens, New York
\nJanuary 2022
\n$1.5 billion
\nEast Coastal Resiliency Project
\nFlood Control
\nNew York City
\nDecember 2021
\n$1.27 billion
\nAmtrak Gateway Bridge Enhancement
\nBridge
\nSecaucus, New Jersey
\nJanuary 2022
\n$1.04 billion
\nMoses-Adirondack Smart Path
\nEnvironmental
\nNew York City
\nOctober 2021
\n$484 million
\nRutgers Cancer Institute
\nEducation
\nNew Brunswick, New Jersey
\nJanuary 2022
\n$388 million
\nAnaerobic Digester Facilities
\nSewer
\nHunts Point, New York
\nMarch 2022
\n$309 million
\nBaron Winds Project 121MW PH1
\nEnvironmental
\nCohocton, New York
\nNovember 2021
\n$297 million
\nAmazon Robotics Fulfillment Center
\nWarehouse
\nJohnston, Rhode Island
\nFebruary 2022
\n$290 million
\nBroad & Washington Mixed-Use
\nApartment
\nPhiladelphia
\nJanuary 2022
\n$275 million<\/p>\n

SOURCE: Dodge Data & Analytics<\/p>\n<\/div>\n

Another growth sector in the region includes healthcare construction. Dodge forecasts 2022 starts in this sector to reach $6.25 billion, a 50% increase from 2021. This category includes inpatient hospitals, clinics and nursing homes.<\/p>\n

Richard Branch, chief economist at Dodge, said to expect growth opportunities specifically in inpatient hospital construction.\u00a0<\/p>\n

\u201cThere\u2019s been a huge underinvestment in the inpatient side of the market here in the United States,\u201d said Branch. \u201cThat will certainly allow this market to grow. I think inpatient will outgrow outpatient.\u201d<\/p>\n

Martin said as people move away from major metro areas in high cost cities in the Northeast, that could spark development in healthcare starts in more rural areas of the region, such as New Hampshire, Vermont and Maine, which have had among the highest rates of in-migration since the start of the pandemic.<\/p>\n

Dodge estimates manufacturing starts in the Northeast will reach $2.99 billion in 2022, or 47% year-over-year growth. Still, that\u2019s just a fragment of the manufacturing construction activity in the West, for example, where Dodge projects starts to reach $14.39 billion in 2022.\u00a0<\/p>\n

Taken at face value, those increases are impressive. But inflation is boosting the growth numbers, said Martin.<\/p>\n

For example, adjusted for inflation, projected 2022 education starts drop from 19% growth to 7% growth. Forecasted nonbuilding starts in 2022, such as highways, bridges, power plants and gas plants, drop from a 8% growth to a 3% contraction when inflation is taken into account.<\/p>\n

Similar to the rest of the U.S., Dodge forecasts office starts in 2022 in the Northeast region to drop to $8.35 billion, a 17% decrease from 2021. Hospitality starts are pegged to fall to $1 billion, a 4% drop from 2021.<\/p>\n

New York led the Northeast region in 2021 with about $41.27 billion of total construction starts, an 18% increase from 2020. Despite the growth, starts still lagged the $50.71 billion pre-pandemic level seen in 2019. And through April, building had slowed.\u00a0\u00a0<\/p>\n

For the first four months in 2022, nonresidential construction activity in the New York, Northern New Jersey and Long Island region<\/a> dropped 4%.<\/p>\n

Pennsylvania ranked second in the Northeast region, with about $22.2 billion in total construction starts in 2021, a 32% increase from 2020 and above its 2019 totals. But for the first four months in 2022, nonresidential construction activity in Pennsylvania dropped 12%<\/a>.<\/p>\n

Connecticut posted the only negative construction start growth in the Northeast region in 2021, dropping 6% from 2020, according to Dodge. Following the regional trend, nonresidential construction in the state dropped 27%<\/a> in the first four months of 2022.<\/p>\n

Dodge forecasts the GDP of both Connecticut and Rhode Island to grow 3.8% in 2022, behind only Massachusetts’ projected 4.1% growth in the Northeast region.\u00a0<\/p>\n

New York and Pennsylvania are pegged at 3.2% and 3% growth, respectively, according to Dodge. That lags the national GDP forecast of 3.5%.<\/p>\n

\n
State GDP growth of Northeast region<\/h6>\n

State
\n2017
\n2018
\n2019
\n2020
\n2021
\n*2022 projection
\nMassachusetts
\n1.9%
\n3.8%
\n2.9%
\n-3.7%
\n6.4%
\n4.1%
\nRhode Island
\n-0.6%
\n-0.2%
\n1.4%
\n-3.4%
\n5.5%
\n3.8%
\nConnecticut
\n1.7%
\n1.1%
\n0.6%
\n-6.2%
\n4.2%
\n3.8%
\nNew Hampshire
\n0.7%
\n1.9%
\n2.1%
\n-2.1%
\n8.5%
\n3.6%
\nNew Jersey
\n0.4%
\n2.4%
\n2.1%
\n-4.6%
\n4.9%
\n3.3%
\nNew York
\n1.2%
\n2.7%
\n2.5%
\n-5.0%
\n5.0%
\n3.2%
\nPennsylvania
\n0.9%
\n1.4%
\n1.7%
\n-4.5%
\n4.4%
\n3.0%
\nVermont
\n0.3%
\n0.4%
\n1.0%
\n-4.2%
\n3.5%
\n2.7%
\nMaine
\n2.0%
\n2.7%
\n2.2%
\n-1.1%
\n5.2%
\n2.4%<\/p>\n

SOURCE: Dodge Data & Analytics<\/p>\n<\/div>\n

This item was originally posted here: Read More<\/a><\/p>","protected":false},"excerpt":{"rendered":"

This story is the third in a series looking at the health of the construction industry in regions throughout the … Read more<\/a><\/p>\n","protected":false},"author":0,"featured_media":9807,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1066,457],"tags":[],"class_list":["post-9806","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-posts","category-construction-dive","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33"],"_links":{"self":[{"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/posts\/9806","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/comments?post=9806"}],"version-history":[{"count":0,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/posts\/9806\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/media\/9807"}],"wp:attachment":[{"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/media?parent=9806"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/categories?post=9806"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/essential.construction\/news\/wp-json\/wp\/v2\/tags?post=9806"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}