Latest Dodge Construction Shows a Slow Start for Nonresidential Construction in January

Total construction starts expanded +0.7% in January to a seasonally adjusted annual rate of $1.24 trillion, according to Dodge Construction Network. Nonresidential building starts fell by -15.4%, residential starts decreased -6.4%, and nonbuilding starts grew +24.3% over the month. On a year-over-year basis, total construction starts were up +5% from January 2025. Nonresidential starts were down -10.3%, residential starts were down -17% and nonbuilding starts were up by +46.1% over the same period. For the 12 months ending January 2026, total construction starts were up +6.1% from the 12 months ending January 2025. Residential starts were down -6%, nonresidential starts were up +5.5% and nonbuilding was up +21%.  

“Nonbuilding construction remained the primary engine of growth in the first month of 2026,” said Eric Gaus, chief economist at Dodge Construction Network, in the press release. “Three mega projects in the nonbuilding sector accounted for nearly $20 billion or almost half of the growth in January, which would mean total construction would have been negative without those three projects.”

Nonresidential 

Nonresidential building starts decreased -15.4% in January to a seasonally adjusted annual rate of $378 billion. Commercial starts were down -27.3%, alongside a drop in offices and data centers (-52.2% m/m), parking garages (-6.7% m/m) and hotels (-17.4% m/m). Meanwhile, warehouses (+10.2% m/m) and retail starts (+6.5% m/m) posted an increase between December and January. Institutional starts declined -15.2%, driven by weaker education (-21.9% m/m) and miscellaneous institutional (-26.1% m/m) starts. This decline was partially offset by 10.5% m/m growth in healthcare facility starts. Manufacturing, meanwhile, pulled up by +97.5% in January. On a year-over-year basis, nonresidential starts are down -10.3% compared to Jan. 2025. Commercial starts are up +14.2% and institutional starts are down -29.6% over the same period.   

For the 12 months ending Jan. 2026, total nonresidential starts were up +5.5% compared to the 12 months ending Jan. 2025. Commercial starts were up +19.4%, institutional starts decreased -4.4%, and manufacturing starts were up +3.5% over the same period.  

The largest nonresidential building projects to break ground in January were the $1.2-billion New York Presbyterian Cancer Center in New York, NY; the $1-billion Amkor Semiconductor Advanced Packaging (Phase 1) in Peoria, AZ; and the $714-million QTS CLT1 Data Center (Phase 1) in York, SC.  

Residential 

Residential building starts fell by -6.4% in January to a seasonally adjusted annual rate of $345 billion. Single family starts increased +1.5% month-to-month (m/m), while multi-family starts fell by -17.8% m/m. On a year-over-year basis, residential starts are down -17% compared to January 2025, with single-family starts down -21.5% and multi-family starts down -9.2%. 

For the 12 months ending January 2026, total residential starts fell -6%. Single-family starts fell -15.2% compared to the 12 months ending Jan. 2025, and multi-family starts increased +13.6% over the same period.  

The largest multi-family structures to break ground in January were the $335 million 38 Gramercy Park East Condominiums in New York, NY; the $265-million Lakeview Residence in West Palm Beach, FL; and the $200-million Homestead Gateway Mixed Residential Tower in Jersey City, NJ.  

Nonbuilding

Nonbuilding construction starts grew +24.3% in January to a seasonally adjusted annual rate of $522 billion. The category was held up solely by the electric power/utilities which soared by +184.8%. However, highways and bridges (-42.3% m/m), miscellaneous nonbuilding (-31.5% m/m) and environmental public works (-5.9% m/m) faced declines.  

For the 12 months ending Jan. 2026, total nonbuilding starts were up +21%. Environmental public works fell by -5.3% compared to the 12 months ending Jan. 2025. Highway and bridge starts were up +3.4%, miscellaneous nonbuilding starts were up +36.2% and utility/gas starts increased +67.9% over the same period.  

The largest nonbuilding projects to break ground in January included the $12-billion Port Arthur LNG – Liquefaction Phase 2 (Trains 3 & 4) in Port Arthur, TX;  the $6-billion Homer City Energy Campus 4.4 GW in Homer City, PA; and the $1.5-billion Tehuacana Creek 1 Solar and Battery Storage project in Navarro, TX.