San Diego Construction1024 643030cf13f1f

Dodge Momentum Index Slips -8.6% in March

April 7, 2023

The Dodge Momentum Index (DMI), issued by Dodge Construction Network, slipped -8.6% in March to 183.7 points (2000=100) from the revised February reading of 201 points. In March, the commercial component of the DMI fell -6.6%, and the institutional component decreased -12.9%. The DMI is a monthly measure of the initial report for nonresidential building projects in planning, shown to lead construction spending for nonresidential buildings by a full year.

“We are predicting the Dodge Momentum Index to work its way back to historical norms throughout 2023, concurrent with weaker economic conditions,” said Sarah Martin, associate director of forecasting for Dodge Construction Network, in the press release. “Lending standards for small banks in particular have substantially tightened as banking insecurity intensifies. As a result, owners and developers are more likely to pullback in the short-term, which would further contract the DMI as we continue into the year.”

Commercial planning in March was driven down by less projects in the office and warehouse sectors, decreasing -29% and -11%, respectively. Institutional planning weakened more substantially, as healthcare fell -17%, education dipped -6%, and amusement planning activity dropped -14%. On the upside, however, a steady flow of research and development laboratories entered the queue, supporting the otherwise weakening sector. Year over year, the DMI remains +24% higher than in March 2022. The commercial component was up +37%, and the institutional component was +2% higher.

A total of 18 projects with a value of $100 million or more entered planning in March. The leading commercial projects included a $300-million office building in Chicago, and the $215-million 58 Logistics Center Industrial Park warehouse project in Bakersfield, CA. Two projects at UT Southwestern in Dallas, led the institutional sector: the $425-million School of Public Health and Health Professions building, and the $348-million rehabilitation hospital.   

Sponsored Recommendations