Total construction in 2004 increases 10% over 2003 totals

Nonresidential, store construction, and office construction all saw improvements

McGraw-Hill Construction, a division of the McGraw-Hill Companies, recently reported that total construction in 2004 climbed 10% to $582.9 billion, which follows a 5% gain in 2003. McGraw-Hill said the 2004 total marks the largest annual increase since 1999, when construction starts advanced 10%.

In 2004, nonresidential construction increased 3% to $160 billion, a significant increase compared to total nonresidential construction in 2003, which was flat, and the 2001-2002 period, when nonresidential building fell a combined 11%. Total store construction in 2004 increased 5%, while hotel construction advanced 7% and warehouse construction jumped 10%. Office construction increased in 2004 as well, climbing 15%, compared to a 43% decline recorded between 2001 and 2003.

In December 2004, new construction starts were down 2%, which decreased from the November 2004 total of $585.2 billion to a seasonally adjusted annual rate of $575.2 billion. Nonresidential building slipped in December as well, falling to a seasonally adjusted annual rate of $143 billion, which is 2% behind the November rate of $146.6 billion.

Construction starts for the major commercial categories were primarily down in December: store construction dropped 8%, office construction fell 29%, hotel construction fell 55%, and school construction was down 8%. However, warehouse construction rebounded in December, increasing 92% after falling 30% in November. Additionally, construction starts for transportation terminals, health-care facilities, churches, and public buildings were up 10%, 19%, 45%, and 119%, respectively.

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