Commercial Construction Soars in September

Total construction starts were up +3.1% in September to a seasonally adjusted annual rate of $1.26 trillion, according to Dodge Construction Network. Nonresidential building starts rose by +11.9%, residential starts improved +3.6%, and nonbuilding starts fell -6.2% over the month. On a year-to-date basis through September, total construction starts were up +3.5% from last year. Nonresidential starts were up +5%, residential starts were down -4.2% and nonbuilding starts were +10.8% higher over the same period.  

For the 12 months ending Sept. 2025, total construction starts were up +6.7% from the 12 months ending Sept. 2024. Residential starts were down -1.4%, nonresidential starts increased 6.8%, and nonbuilding starts were up +16.7% over the same period.  

“September construction starts data marks the third month of steady improvements,” stated Eric Gaus, chief economist at Dodge Construction Network. “However, a +3% growth rate is just keeping up with inflation, and we need fourth quarter growth of +25% to match annual growth of 2024. Megaprojects continue to provide significant report; just six projects accounted for 12% of the total value in September.” 

Nonresidential 

Nonresidential building starts increased +11.9% in September to a seasonally adjusted annual rate of $478 billion. Commercial starts were up +21.2%, as only retail failed to grow over the month. Most notably, parking and service stations starts rose +30.1% and offices increased 32.6% between August and September. Institutional starts improved +0.9%, where strong activity in education and dorms (+25.8% m/m), other institutional categories (+11.9% m/m) offset a large decline in health care facilities (-47.8% m/m). Manufacturing activity remains volatile, as the sector jumped +45.2% in September, following last month’s 24.4% drop. On a year-to-date basis through September, nonresidential starts are up +5% compared to Sept. 2024. Commercial and industrial starts are up +10.9% and institutional starts are down -0.8% over the same period.  

For the 12 months ending Sept. 2025, total nonresidential starts were up +6.8% compared to the 12 months ending Sept. 2024. Commercial starts were up +22.5%, institutional starts improved +5%, and manufacturing starts were down -23.6% over the same period.  

The largest nonresidential building projects to break ground in September were the $2.5-billion Hut 8 Data Center (West Feliciana Parish) in St Francisville, LA;  the $1.7-billion NYS Life Sciences Public Health Laboratory in Albany, NY; and the $1.2-billion Llano Data Center Phase 1 in Claude, Texas. 

Residential 

Residential building starts increased +3.6% in September to a seasonally adjusted annual rate of $379 billion. Single family starts increased +1.7%, while multifamily starts expanded 6.4%. On a year-to-date basis through September, residential starts are down -4.2% – with single family starts down -12.1% and multifamily starts up +13.2%.  

For the 12 months ending Sept. 2025, total residential starts fell -1.4%. Single-family starts fell -7.6% compared to the 12 months ending Sept. 2024, and multi-family starts increased +11.6% over the same period.  

The largest multi-family structures to break ground in September were the $584-million Harborside 8 Mixed Use Residential – Commercial & Parking in Jersy City, NJ; the $575-million 5 Times Square Residential Conversion in New York, NY; and the $480-million Imperial Tower – Mixed Use-Hotel-Pool-Parking  in Jersey City, NJ.  

Regionally, total construction starts in September rose in the Northeast (+36.3% m/m), Midwest (+10.9% m/m), and West (+1.4% m/m) and declined in the South Atlantic (-0.3% m/m), and South Central (-10.6% m/m). 

Nonbuilding  

Nonbuilding construction starts fell 6.2% in September to a seasonally adjusted annual rate of $404 billion. Utilities (-62.5% m/m) was the sole category contracting, while highway and bridges (+7.4% m/m), environmental public works (+6.6% m/m), and miscellaneous nonbuilding (+116.5% m/m) starts offset the decline.

On a year-to-date basis through September, nonbuilding starts were up 10.8%, alongside gains in highways and bridges (+7.4%), miscellaneous nonbuilding (+42.1%), and utilities (+12.9%). Conversely, environmental public works starts are down -2.2% year-to-date through September.  

For the 12 months ending Sept. 2025, total nonbuilding starts were up +16.7%. Environmental public works improved by +10.8% compared to the 12 months ending September 2024. Highway and bridge starts were up +10.2%, miscellaneous nonbuilding starts were up +46.1% and utility/gas starts increased +17.1% over the same period.  

The largest nonbuilding projects to break ground in September included the $3-billion AirTrain Newark Replacement in Newark, NJ; the $2.7-billion Hugh Brinson Pipeline in Midland, TX; and the $1.1-billion Walnut Creek WWTP Renovation and Expansion in Austin, TX. 

Press release: https://www.construction.com/company-news/construction-starts-improve-3-1-in-september/