The Dodge Momentum Index moved 1.4 percent higher in July to 169.8 (2000=100) from the revised June reading of 167.3. 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. In July, the commercial component of the Momentum Index grew by 3.3 percent, while the institutional component fell 1.5 percent. The headline Momentum Index has risen steadily since its slippage during the third quarter of 2017. Stronger economic growth and the support from still-healthy real estate market fundamentals (occupancies and rents) have contributed to these gains for construction projects at the planning stage, which have yet to be restrained by the uncertainty arising from higher material costs and higher interest rates.
In July, 17 projects each with a value of $100 million or more entered planning. The two leading commercial projects were a $295 million data center in Sterling, Va., and a $225 million warehouse/office building in Ontario, Calif. The leading institutional projects were the $325 million MUSC Health Community Hospital in Summerville, S.C., and the $150 million Texas Acute Care Hospital in Mansfield, Texas.