The Dodge Momentum Index rose 1.2 percent in December compared to the previous month, according to McGraw Hill Construction, a division of McGraw Hill Financial. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year.
December’s increase brought the Momentum Index to 118.3 (2000=100), the highest reading since February 2009. Over the course of 2013, the Momentum Index showed steady improvement, with December up 32 percent compared to the same month a year ago. Despite the strong percentage growth during 2013, the Momentum Index remains significantly below its December 2007 pre-recession peak of 191.3, according to the latest report from McGraw Hill.
The latest month’s increase for the Momentum Index was driven by both its commercial and institutional components, according to the report. On the commercial side, the 1.5-percent gain was largely the result of greater planning activity for office and hotel development. Among the larger office projects to enter the planning pipeline in December were the $350 million Moffat Place Office Campus in Sunnyvale, Calif., the $300 million Boston Garden Office Tower in Boston, and the $95 million expansion of a Microsoft data center in Quincy, Wash.
The 0.8-percent gain for the institutional component was due primarily to a pickup in plans for education-related buildings, the largest of which were a $120 million renovation/addition to the University of Michigan’s School of Dentistry in Ann Arbor, Mich., a $100 million Nuclear Power Training Facility in Charleston, S.C., and a $90 million renovation to the University of Dearborn’s Engineering Laboratory in Dearborn, Mich., according to the report.