February Construction Falls 7 Percent

Press Release

February Construction Falls 7 Percent

March 20, 2012 - New York, NY

At a seasonally adjusted annual rate of $376.0 billion, new construction starts in February dropped 7% from the previous month, according to McGraw-Hill Construction, a division of The McGraw-Hill Companies.  The nonbuilding construction sector, comprised of public works and electric utilities, lost considerable momentum in February, and diminished activity was also reported for nonresidential building.  Meanwhile, residential building in February was able to register modest growth.  For the first two months of 2012, total construction starts on an unadjusted basis came in at $52.9 billion, down 14% from a year ago.  For the twelve months ending February 2012 versus the twelve months ending February 2011, which lessens the volatility present in year-to-date comparisons of just two months, total construction starts were down 2%.

The February statistics lowered the Dodge Index to 80 (2000=100), compared to 85 in January.  For 2011 as a whole, the Dodge Index averaged 91.  "The pace of construction starts during the first two months of 2012 was subdued, retreating to the lower end of its recent range," stated Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction.  "Renewed expansion for the construction industry is still struggling to take hold, with gains for a few project types such as multifamily housing being outweighed by declines for project types that are largely publicly financed.  This was especially the case in February, when much of the downward pull came from weakness for public works and institutional building."

Nonbuilding construction in February dropped 16% to $107.8 billion (annual rate). Highway construction plunged 26%, resuming the declining trend that was present for much of 2011 before contracting improved briefly in December and January.  Murray noted, "The factors affecting new construction starts for highways are generally negative – fiscal 2012 appropriations included a 5% cut to the federal-aid highway program, the lift from the federal stimulus act has run its course, states continue to deal with budget constraints, and the funding authority under the existing federal transportation legislation is set to expire on March 31.  While Congress has taken steps to extend the funding authority by considering new transportation measures, such as the $109 billion two-year bill recently passed by the Senate, the uncertainty over the shape and timing of a new transportation package has added another negative to this year’s prospects for highway construction."  Other large declines for public works in February were registered by water supply systems, down 18%; miscellaneous public works (including site work), down 21%; and sewers, down 22%.  The decline for miscellaneous public works was cushioned by $344 million for site work at an oil storage facility in Houston TX.  The two public works categories able to register gains in February were the following – bridges, up 19% with the help of a $162 million railroad bridge in California; and river/harbor development, up 28%.  The electric utilities category in February fell 21%, although the latest month did include several noteworthy projects – an $880 million wind power facility in Texas, a $232 million wind power facility in Michigan, a $186 million wood-fired power plant in New Hampshire, and a $140 million upgrade to a nuclear power plant in California.

Nonresidential building, at $127.6 billion (annual rate), dropped 7% in February.  A large part of the shortfall came from a 22% slide for educational buildings, continuing the descent for this category which has been underway for the past three years.  While February did include groundbreaking for two large high school projects – a $120 million new high school in Cincinnati OH and an $87 million high school addition in Pittsburgh PA, they were not enough to avert a decline for the overall category.  Public buildings (courthouses, detention facilities, and military buildings) weakened further in February, plummeting 46%.  The healthcare facilities category in February decreased 9%, despite groundbreaking for a $335 million medical center replacement project in Joplin MO and a $180 million hospital tower in Oakland CA.  The other institutional categories reported gains in February, including a 22% increase for amusement-related work, which was helped by a $105 million convention center expansion in San Jose CA.  Transportation terminal work in February advanced 45%, helped by the $78 million addition to Terminal B at George Bush Intercontinental Airport in Houston TX and a $44 million renovation project at Grand Central Station in New York NY.

On the commercial side, warehouses and hotels retreated in February, falling 8% and 47% respectively.  Office construction improved 11% in February, reflecting such projects as a $106 million Social Security Administration building in Baltimore MD, a $75 million renovation to the U.S. Department of Commerce building in Washington DC, and a $65 million corporate headquarters in Malvern PA.  Store construction in February was able to advance 35% from a weak January, aided by the start of a $300 million observation restaurant and entertainment venue in Las Vegas NV.  The manufacturing plant category in February increased 9%, boosted by a $99 million upgrade to a solar panel manufacturing plant in Portland OR.

Residential building in February grew 3% to $140.6 billion (annual rate).  Most of the upward push came from multifamily housing, which rebounded 10% after sliding back in January.  Large multifamily projects reported as February starts included a $164 million condominium complex in Santa Monica CA and a $57 million apartment building in Gambrills MD.  Single family housing, up 1%, essentially held steady in February, due to a mixed performance by region – the South Atlantic, up 8%; the Midwest, up 5%; the Northeast, down 1%; the West, down 2%; and the South Central, down 3%.  Murray added, "While single family housing was able to show some gains towards the end of 2011, the early months of 2012 have seen that hesitant improving trend put on hold."

The 14% decline reported for total construction on an unadjusted basis during the first two months of 2012, compared to 2011, was the result of a mixed performance by major sector.  Nonresidential building dropped 17% year-to-date, reflecting this pattern – commercial building, down 9%; institutional building, down 15%; and manufacturing building, down 54%.  Residential building climbed 20% year-to-date, with multifamily housing up 23% while single family housing grew 20% from its very weak amount at the start of last year.  Nonbuilding construction fell 33% year-to-date, due to a 20% retreat for public works and a 56% reduction for electric utilities.  The size of the year-to-date decline for nonbuilding construction was affected by the comparison to elevated activity during the first two months of 2011, which included such large projects as a $2.5 billion solar power facility in California and $2.1 billion for work on the LBJ Freeway in Dallas TX.  By region, total construction starts in the first two months of 2012 showed an increase for one region, with the South Atlantic climbing 7%, while declines were registered by the other four regions – the Midwest, down 2%; the West, down 11%; the Northeast, down 21%; and the South Central, down 32%.

The 2% drop for total construction on a twelve-month moving total basis, meaning the twelve months ending February 2012 versus the twelve months ending February 2011, was the result of this behavior by major sector – nonresidential building, down 3%; residential building, up 8%; and nonbuilding construction, down 10%.  By geography, the twelve months ending February 2012 showed the following performance for total construction – the South Atlantic, up 13%; the West, up 3%; the Northeast and Midwest, each down 8%; and the South Central, down 12%.

About McGraw-Hill Construction:
McGraw-Hill Construction connects people, projects, and products across the construction industry. For more than a century, it has remained North America’s leading provider of project and product information, plans and specifications, and industry news, trends, and forecasts. McGraw-Hill Construction serves more than one million customers in the global construction industry through Dodge, Sweets, Architectural Record, Engineering News-Record, GreenSource, and SNAP. To learn more, visit www.construction.com or follow @mhconstruction on Twitter.

About The McGraw-Hill Companies:
Founded in 1888, The McGraw-Hill Companies is a leading global financial information and education company that helps professionals and students succeed in the knowledge economy. Leading brands include Standard and Poor’s, McGraw-Hill Education, Platts energy information services, and J.D. Power and Associates. The Corporation has approximately 21,000 employees with more than 280 offices in 40 countries. Sales in 2010 were $6.2 billion. Additional information is available at www.mcgraw-hill.com.

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January Construction Slides 13 Percent

Press Release

January Construction Slides 13 Percent

New York, N.Y. – February 21, 2014 – The value of new construction starts fell 13% in January to a seasonally adjusted annual rate of $485.0 billion, according to McGraw Hill Construction, a division of McGraw Hill Financial.  The downturn followed a healthy performance in December, which was the third highest month for total construction starts during 2013.  January’s retreat encompassed all three main construction sectors, with moderate declines reported for nonresidential building and housing, as well as a more substantial loss of momentum for nonbuilding construction (public works and electric utilities) after a particularly robust December.  On an unadjusted basis, total construction starts in January came in at $34.1 billion, down 5% from the same month a year ago.

The January statistics lowered the Dodge Index to 103 (2000=100), compared to a revised 118 for December and below the average Index reading of 110 for all of 2013.  “The year 2014 began slowly, due to behavior specific to each of the three main construction sectors,” stated Robert A. Murray, chief economist for McGraw Hill Construction.  “Nonresidential building in 2013 advanced 7%, but the progress was occasionally hesitant, including sluggish activity at the end of last year that carried over into January.  At the same time, the prospects for continued growth for nonresidential building during 2014 are generally positive, helped by receding vacancies for commercial properties and some improvement in the fiscal health of state governments.  Residential building in 2013 climbed 24%, but towards the end of last year growth began to decelerate as mortgage lending to first-time homebuyers remained stringent. The January slowdown for housing was due in part to tough winter weather conditions, yet the deceleration in recent months bears watching going forward.  Nonbuilding construction in 2013 dropped 12%, as the steep pullback by electric utilities outweighed surprising growth for public works. Last year’s nonbuilding performance was also quite volatile on a month-to-month basis, including strong activity in December that’s now been followed by a sharp reduction in January. With 2014 not likely to see the same volume of very large public works projects reach the construction start stage, nonbuilding construction is expected to register another decline this year, and January’s downturn is part of that broader trend.”

Nonresidential building in January dropped 6% to $157.3 billion (annual rate), and was down 7% from last year’s average monthly pace.  The commercial building sector in January fell 13%, with declines from the prior month shown by hotels, down 43%; and warehouses, down 3%.  Hotels and warehouses posted strong percentage growth during 2013, with each rising 29%, and the sluggish activity in January is viewed as a pause in what’s expected to be continued growth for both structure types during 2014.  Cushioning the January decline for the commercial building sector was a 21% increase for office construction, helped by groundbreaking for such projects as a $125 million corporate headquarters in Houston TX, a $66 million office park in Mountain View CA, and a $44 million office building in Raleigh NC.  Store construction in January improved 4%, reflecting the start of a $30 million shopping mall in Lakeland FL and a $25 million department store in Las Vegas NV.  The manufacturing plant category had a strong January, jumping 44%, due to the impact of two very large projects – a $1.2 billion propane dehydrogenation facility in Texas and a $450 million oil refinery expansion in North Dakota.

The institutional building sector in January decreased 12%, as the recent signs of stability after a lengthy five-year decline continue to be tenuous.  The educational building category receded 3%, although the month did include the start of several large university-related projects – a $155 million renovation to an academic building at Princeton University in Princeton NJ, a $100 million business school at Baylor University in Waco TX, and a $92 million science and laboratory facility at the University of Tennessee in Knoxville TN.  Healthcare facilities in January dropped 17%, as this structure type continues to show an up-and-down pattern on a monthly basis, keeping renewed growth in a sustained manner on hold.  The smaller institutional categories in January were mixed, with reduced activity reported for transportation terminals (down 31%) and amusement-related work (down 20%), while public buildings (up 6%) and religious buildings (up 58%) showed improvement from depressed levels in December.  The decline for the amusement category was relative to a very strong December, which included the start of the $763 million Vikings Multipurpose Stadium in Minneapolis MN.  Large project support for the amusement category was also present in January, coming from $90 million estimated for a new facility at the Disney Animal Kingdom in Lake Buena Vista FL, as part of a larger $500 million project at that theme park.

Residential building, at $204.7 billion (annual rate), slipped 2% in January.  The retreat came as the result of a 6% decline for single family housing, which has now settled back for three months in a row.  The January single family decline was widespread geographically, with this pattern for the five major regions relative to December – the South Central, down 13%; the Northeast and West, each down 6%; the Midwest, down 3%; and the South Atlantic, down 2%.  Murray noted, “Harsh weather conditions in January played some role in the sluggish single family performance, in combination with the recent pickup in mortgage rates and the tight lending environment as it relates to first-time homebuyers.  Still, it’s expected that single family construction should soon regain upward momentum, given the very low inventory of new homes for sale and what’s anticipated to be a strengthening economy and jobs picture.”  Multifamily housing in January grew 12%, staying on the broad upward track that began back in 2010.  Large projects that supported the January increase were led by a $400 million condominium and apartment building in New York NY, as this metropolitan area continues to see very large multifamily projects reach groundbreaking.  Other large multifamily projects reported as January starts were located in Washington DC ($90 million), Miami FL ($69 million), Minneapolis MN ($54 million), and Dallas TX ($50 million).

Nonbuilding construction in January plunged 32% to $123.0 billion (annual rate), following its 40% surge in December.  New electric utility work dropped 61% from the elevated pace witnessed in December, returning to the downward path that was present for much of last year.  Although January did include the start of an $800 million natural gas-fired power plant in Pennsylvania, this was not enough to avert the category’s steep drop for the month.  The public works sector overall in January was down 25%, with declines across most of the project types.  While January did include the start of a $153 million highway paving project in Texas and the $126 million deck replacement of the Pulaski Skyway in New Jersey, highway and bridge construction for the month fell 35%.  Other January declines were reported for river/harbor development, down 26%; miscellaneous public works (site work, mass transit, and pipelines) down 13%; and water supply systems, down 5%.  Sewer construction was the one public works category to register an increase in January, rising 21%, with the lift coming from such projects as a $173 million sewer tunnel in Hawaii.

The 5% decline for total construction starts on an unadjusted basis for January 2014 relative to January 2013 was due to this performance by sector – nonresidential building, down 6%; residential building, up 8%; and nonbuilding construction, down 19%.  By geography, total construction starts for January 2014 relative to January 2013 showed declines in four of the five major regions – the West, down 15%; the South Atlantic, down 9%; the South Central, down 5%; and the Midwest, down 3%.  The Northeast was the only region to register a year-over-year gain for January 2014, advancing 15%.

Useful perspective can be obtained by looking at twelve-month moving totals, in this case the twelve months ending January 2014 versus the twelve months ending January 2013, which lessens the volatility present in one-month comparisons.  For the twelve months ending January 2014, total construction starts were up 5%, due to this pattern by sector – nonresidential building, up 6%; residential building, up 22%; and nonbuilding construction, down 13%.  By geography, the twelve months ending January 2014 showed the following behavior for total construction starts – the Northeast, up 16%; the Midwest and West, each up 9%; the South Central, up 2%; and the South Atlantic, down 5%.

About McGraw Hill Construction:
McGraw Hill Construction provides essential data, news, insights, and intelligence to better inform construction professionals’ decisions and strengthen their market position. McGraw Hill Construction’s data, analytics, and media businesses – Dodge, Sweets, Architectural Record, and Engineering News-Record  – create opportunities for owners, architects, engineers, contractors, building product manufacturers, and distributors to strengthen their market position, size their markets, prioritize prospects, and target and build relationships that will win more business. McGraw Hill Construction serves more than one million customers through its trends and forecasts, industry news, and leading platform of construction data, benchmarks, and analytics, including Dodge MarketShare™, Dodge BuildShare®, and Dodge SpecShare®. Construction data is available for North American and global markets. To learn more, visit www.construction.com.

About McGraw Hill Financial:
McGraw Hill Financial (NYSE: MHFI) is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics. The Company's iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, J.D. Power, and McGraw Hill Construction. The Company has approximately 17,000 employees in 27 countries. Additional information is available at www.mhfi.com.

Media Contact:
Kathy Malangone, Senior Director, Communications:
McGraw Hill Construction, 212-904-4376, kathy.malangone@mhfi.com

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New Construction Starts in December Improve 5 Percent; Annual Total for 2013 Climbs 6 Percent to $516.8 Billion

Press Release

New Construction Starts in December Improve 5 Percent;
Annual Total for 2013 Climbs 6 Percent to $516.8 Billion

NEW YORK – January 23, 2014– New construction starts in December grew 5% to a seasonally adjusted annual rate of $554.5 billion, according to McGraw Hill Construction, a division of McGraw Hill Financial.  Although both nonresidential building and housing settled back during the final month of 2013, the nonbuilding construction sector (public works and electric utilities) finished the year on a strong note. For 2013 as a whole, total construction starts advanced 6% to $516.8 billion.  This follows the 10% gain reported for 2012 (which drew support from a record amount of new electric utility starts that year) and modest 2% gains in both 2010 and 2011.  If the volatile electric utility category is excluded, total construction starts in 2013 would be up 14%, following a 9% gain in 2012 and essentially flat activity during 2010 and 2011.

The December statistics produced a reading of 117 for the Dodge Index (2000=100), compared to 111 in November.  This marked the third highest month for the Dodge Index during 2013, after September’s 118 and October’s 125.  During the first eight months of the year, the Dodge Index had hovered within the fairly narrow range of 100 to 108, but then showed a stronger pace of activity during the final four months, reflecting in part the impact of several very large projects.  In December, large projects that were entered as construction starts included the $1.5 billion Goethals Bridge replacement project in New York and New Jersey, two large natural gas-fired power plants, and two large manufacturing plants.  For all of 2013, the Dodge Index averaged 109, up from 103 in 2012.

“The construction industry in 2013 made progress towards establishing a more broad-based recovery, after several years in which the upturn was more limited in scope,” stated Robert A. Murray, chief economist for McGraw Hill Construction.  “Housing continued to lead the way, strengthening throughout much of 2013, and it was joined by a faster pace for commercial building, albeit from low levels.  The institutional building sector registered a considerably smaller decline than in prior years, as its lengthy downturn appears to be ending.  The public works sector in 2013 showed surprising strength, helped by the start of several major projects even amidst restrained government spending.  Running counter in 2013 was a steep drop for new electric utility starts, after the robust amount reported in 2012.  For 2014, the prospects look good for total construction, with growth anticipated for housing and commercial building, while the institutional building sector at least stabilizes.”

Nonresidential building in December slipped 7% to $168.6 billion (annual rate), pulling back for the second month in a row after its elevated pace in October, although its fourth quarter average was still 17% above what was reported in the first quarter.  Several commercial categories in December paused from the improved activity registered earlier in the fall.  New office construction dropped 44% from November which had been lifted by the start of such projects as the $336 million Transbay office tower in San Francisco CA; in contrast, the largest office projects entered as December starts were an $80 million office complex in Cary NC and a $73 million data center in West Des Moines IA.  Similar December declines were registered by hotels, down 42%; and warehouses, down 46%; although the latest month did include the start of an $88 million Amazon distribution center in Windsor CT.  Store construction, which was the one commercial category that did not post a November gain, managed to increase 6% in December.  The December pause for nonresidential building was cushioned by a sharp 110% jump for manufacturing buildings, which reflected the start of two massive chemical plants in Louisiana, each valued at $500 million.

The institutional building categories in December were mixed.  Educational facilities grew 5%, helped by the start of a $213 million medical research building in Boston MA and a $151 million college science building in Chicago IL.  Healthcare facilities in December jumped 30% from the prior month’s subdued amount, and featured groundbreaking for an $80 million hospital in Virginia and a $70 million cancer center in Wisconsin.  The smaller institutional categories generally weakened in December, with public buildings (courthouses and detention facilities) down 32%; churches, down 44%; and amusement-related work, down 46% (compared to the previous month which included the $763 million Vikings Multipurpose Stadium in Minneapolis MN).  The transportation terminal category retreated a slight 1% in December, and included the start of a $230 million terminal renovation project at Los Angeles International Airport.

For 2013 as a whole, nonresidential building increased 7% to $168.6 billion, shifting to an upward direction after the 5% decline reported for 2012.  The commercial categories overall advanced 16%, faster than the 13% gain witnessed in 2012.  The strongest gain by commercial category was registered by hotels, up 28%; followed by warehouses, up 27%; office buildings, up 17%; and stores, up 1%.  The small 2013 increase for stores was limited by the comparison to 2012 that included the $400 million renovation to Macy’s flagship department store in New York NY.  The manufacturing building category in 2013 surged 36%, helped by the two large chemical plants in Louisiana reported as December starts as well as by such projects as a $1.7 billion fertilizer plant in Iowa, a $1.7 billion natural gas processing plant in West Virginia, and a $1.5 billion industrial gas products plant in Louisiana.  The institutional building group during 2013 decreased 3%, less severe than declines of 9% in 2012 and 11% in 2011.  The two largest institutional categories performed as follows – educational buildings, down 1%; and healthcare facilities, down 6%.  The smaller institutional categories showed this pattern for 2013 – amusement-related work, up 25%; transportation terminals, down 2%; churches down 11%; and public buildings, down 27%.

Residential building in December dropped 6% to $205.3 billion (annual rate), with both sides of the housing market easing back.  Single family housing slipped 3%, as recent months have shown more of an up-and-down pattern after the consistently steady gains witnessed earlier in the year.  When viewed on a quarterly basis, single family housing still registered consistent growth during 2013, with the fourth quarter up 8% compared to the first quarter.  Multifamily housing in December retreated 13% after November’s increase of the same magnitude.  December’s largest multifamily projects were smaller in scale than what had been reported in the previous month, but still included such substantial entries as a $159 million apartment building in Sunny Isles Beach FL, a $128 million condominium tower in Honolulu HI, and a $127 million apartment building in Brooklyn NY.

The 2013 amount for residential building was $205.5 billion, up 24%, and close to the 31% gain reported for 2012.  Single family housing in dollar terms climbed 26%, similar to the prior year’s 29% hike.  The regional pattern for single family housing in 2013 showed increases for all five major regions, as follows – the South Atlantic, up 33%; the Midwest, up 27%; the West and Northeast, each up 26%; and the South Central, up 18%.  Multifamily housing in 2013 advanced 16%, showing additional growth on top of the increases in 2010 (up 23%), 2011 (up 33%), and 2012 (up 37%).  By major region, multifamily housing revealed this performance in 2013 – the Midwest, up 26%; the Northeast, up 24%; the South Atlantic, up 21%; the West, up 13%; and the South Central, down 6%.  The top five metropolitan areas in terms of the 2013 dollar amount of multifamily starts, with the percent change from 2012, were – New York NY, up 23%; Boston MA, up 74%; Washington DC, unchanged from the prior year; Miami FL, up 12%; and Los Angeles CA, down 24%.  Metropolitan areas ranked 6 through 10 for multifamily starts were – Dallas-Ft. Worth TX, down 6%; Chicago IL, up 52%; Seattle WA, unchanged from the prior year, San Francisco CA, up 12%; and Denver CO, up 17%.

Nonbuilding construction in December soared 40% to $180.6 billion (annual rate), which was the highest monthly rate during 2013.  Bridge construction jumped 210%, boosted by the $1.5 billion Goethals Bridge replacement project in Staten Island NY and Elizabeth NJ.  Other large bridge projects that were entered as December starts were $380 million for bridge construction in Stillwater MN and $297 million for bridge construction on the I-35W reconstruction project in Texas.  The highway construction category also had a strong December, rising 19% with the help of $693 million allocated to highway work on the I-35W project in Texas.  River/harbor development in December rose 21%, supported by the start of a $290 million seawall replacement project in Seattle WA.   Sewer construction in December increased a moderate 6%, while water supply construction fell 6%.  The miscellaneous public works category (which includes such diverse project types as pipelines, mass transit, and outdoor sports stadiums) dropped 14% in December, although it did include a $425 million stadium renovation project for Texas A&M University in College Station TX.  The electric utility category in December departed from its generally downward trend during 2013, rising 127%.  Large power plant projects included as December construction starts were two natural gas-fired plants located in New Jersey ($842 million) and Pennsylvania ($800 million), as well as three wind power facilities located in Texas ($300 million and $200 million) and Oklahoma ($225 million).

For the full year 2013, nonbuilding construction dropped 12% to $142.7 billion.  After achieving a record high in current dollar terms in 2012, new electric utility starts plunged 57% in 2013.  In contrast, the public works portion of nonbuilding construction increased 9% in 2013, a resilient performance given concerns that tight government budgets would dampen activity.  Of the public works project types, bridge construction showed the largest percentage gain, climbing 55%.  Aside from what was entered into the December construction start figures, large bridge projects in 2013 included the $3.1 billion Tappan Zee Bridge replacement project across the Hudson River in New York and $1.6 billion for work on the Ohio River Bridges in the Louisville KY and southern Indiana area.  With highway construction up 10% in 2013, highway and bridge construction together registered a 21% gain for the full year.  The top five states for highway and bridge construction in 2013, ranked by the dollar volume of activity, were – Texas, New York, California, New Jersey, and Virginia.  The environmental public works categories posted annual gains for 2013, as follows – river/harbor development, up 30%; water supply systems, up 10%; and sewers, up 1%.  The miscellaneous public works category fell back 18% in 2013, following a 61% increase in 2012, due primarily to a sharply reduced amount of new petroleum and natural gas pipeline starts.

The 6% gain for total construction starts at the national level in 2013 was the result of gains in four of the five major regions.  Showing the strongest growth was the Northeast, up 17%; followed by the Midwest, up 9%; the West, up 8%; and the South Central, up 3%.  The South Atlantic was the one major region to experience a decline in 2013, dropping 3%.  The South Atlantic’s shortfall reflected the comparison to 2012 that included the start of two massive nuclear facilities, located in Georgia and South Carolina.  If electric utilities are excluded from the construction start statistics in the South Atlantic, then total construction for that region in 2013 would be up 19%.

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About McGraw Hill Construction:
McGraw Hill Construction provides essential data, news, insights, and intelligence to better inform construction professionals’ decisions and strengthen their market position. McGraw Hill Construction’s data, analytics, and media businesses – Dodge, Sweets, Architectural Record, and Engineering News-Record  – create opportunities for owners, architects, engineers, contractors, building product manufacturers, and distributors to strengthen their market position, size their markets, prioritize prospects, and target and build relationships that will win more business. McGraw Hill Construction serves more than one million customers through its trends and forecasts, industry news, and leading platform of construction data, benchmarks, and analytics, including Dodge MarketShare™, Dodge BuildShare®, and Dodge SpecShare®. Construction data is available for North American and global markets. To learn more, visit www.construction.com.

About McGraw Hill Financial:
McGraw Hill Financial (NYSE: MHFI) is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics. The Company's iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, J.D. Power, and McGraw Hill Construction. The Company has approximately 17,000 employees in 27 countries. Additional information is available at www.mhfi.com.

Media Contact:
Kathy Malangone, Senior Director, Communications:
McGraw Hill Construction, 212-904-4376, kathy.malangone@mhfi.com

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September Construction Jumps 16 Percent

Press Release

September Construction Jumps 16 Percent 
October 17, 2012 - New York, NY

New construction starts in September climbed 16% to a seasonally adjusted annual rate of $507.2 billion, it was reported by McGraw-Hill Construction, a division of The McGraw-Hill Companies.  The nonbuilding construction sector (public works and electric utilities) led the way, helped in particular by a massive natural gas plant and several very large electric utility projects.  Meanwhile, nonresidential building retreated after its improved performance in August, and residential building eased back slightly.  Through the first nine months of 2012, total construction starts on an unadjusted basis came in at $349.6 billion, up 5% compared to the same period a year ago.

The latest month's data lifted the Dodge Index to 107 (2000=100), up from 92 in August.  This marked the second highest reading for the Dodge Index so far in 2012, following the 115 reported in April, which benefitted from the start of an $8.5 billion nuclear power plant in South Carolina.  "The robust pace for electric utility and gas plant construction during 2012 has occasionally produced volatility for total construction on a month-to-month basis," stated Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction.  "If electric utilities and gas plants are excluded, the level of construction starts in 2012 would be up 2% year-to-date, helped by this year's further growth for multifamily housing and the emerging recovery for single family housing.  As for the other construction sectors, commercial building has shown some strengthening during 2012 – while its dollar amount has grown less than 1% year-to-date, square footage is up 16%.  However, decreased activity continues to be reported in 2012 for institutional building, manufacturing plants, and public works.  Going into 2013, it's not expected that electric utilities will be able to maintain the record pace witnessed in 2011 and 2012, and tight government budgets will restrain the institutional building and public works sectors.  It will be up to housing and commercial building to provide upward momentum, and the impending ‘fiscal cliff' makes continued growth for these sectors less certain."

Nonbuilding construction in September soared 67% to $197.9 billion (annual rate).  The main lift came from a 335% surge for the electric utility and gas plant category, as a $4.8 billion liquefied natural gas plant in Louisiana (the Sabine Pass Liquefaction Project) was included as a September construction start.  Without this project, the gains for several levels of construction activity in September would have been more moderate – electric utilities and gas plants, up 60%; nonbuilding construction, up 19%; and total construction, up 3%.  There were six electric utility projects, each valued in excess of $100 million, listed as September construction starts – a $750 million wind farm in Texas, a $484 million transmission line in Nevada and California, two $300 million gas-fired power plants in Texas, a $171 million transmission line in Kansas, and a $122 million wind farm in Michigan.  Public works construction overall was up 10% in September, helped by gains from the environmental public works categories.  Water supply construction increased 48%, aided by the start of a $192 million water quality control plant in California.  River/harbor development work in September advanced 38%, while sewers rose 19%.  The "other public works" category, which includes a diverse set of projects, climbed 35% in September with the lift coming from a $326 million mass transit rail line in California, a $250 million outdoor sports stadium for Baylor University in Waco TX, and a $220 million petroleum pipeline in Louisiana and Mississippi.  On the negative side, highways and bridges settled back in September, falling 1% and 24% respectively.  For the first nine months of 2012, highways and bridges together dropped 10% compared to last year, including construction start declines for these states – Texas, down 41%; Ohio, down 19%; and Florida, down 16%.

Nonresidential building, at $139.0 billion (annual rate), fell 5% in September, retreating after the 7% gain in the previous month.  The institutional sector showed declines for the majority of its project types.  The educational building category decreased 16% after its August upturn, despite the start of a $110 million science and research center for Temple University in Philadelphia PA, as well as groundbreaking for three large high schools located in Massachusetts ($105 million), Minnesota ($78 million), and Texas ($70 million).  The transportation terminal category in September dropped 40%, although it did include $148 million for phase 1 of the Moynihan Station project in New York NY.  Also weakening in September were amusement-related work, down 27%; and churches, down 18%.  On the plus side, moderate gains in September were registered by healthcare facilities, up 5%; and public buildings (courthouses and detention facilities), up 2%.

The commercial categories in September showed stronger activity relative to August.  Warehouse construction advanced 60%, with the help of such projects as a $57 million distribution center for Dollar Tree in Windsor CT.  Hotel construction increased 37%, aided by a $68 million addition to a hotel in Miami Beach FL, plus two hotel renovations for Westin properties in Atlanta GA ($45 million) and Cleveland OH ($36 million).  Stores and shopping centers, up 11%, included $91 million for the retail portion of the Brickell CitiCentre mixed-use project in Miami FL (with the entire complex having an estimated construction start cost of $500 million).  Office construction grew 9% in September, and included $43 million for the office portion of the Brickell CitiCentre project, as well as corporate office buildings that reached groundbreaking in Canton OH ($42 million), Overland Park KS ($35 million), and Plano TX ($32 million).  Manufacturing plant construction in September dropped 10% compared to August.

Residential building in September slipped 1% to $170.3 billion (annual rate).  Multifamily housing retreated 10% after its 43% jump in August, which though down for the month still maintains the broader upward trend for this project type.  Large multifamily projects that reached groundbreaking in September included $231 million for the condominium portion of the Brickell CitiCentre project in Miami FL.  There were also two large multifamily projects that started in San Francisco CA during September – a $119 million condominium tower and an $82 million apartment building.  Single family housing maintained its gradual upward movement that's been present throughout much of 2012, growing 2% in September.  The pace for single family housing in September was 23% higher than what was reported back in January.

The 5% increase for total construction on an unadjusted basis during the January-September period of 2012 was the result of heightened activity for two of the three main construction groups.  Residential building climbed 26%, with year-to-date gains of 25% for single family housing and 30% for multifamily housing.  Nonbuilding construction was up 6% year-to-date, as a 27% hike for electric utilities and gas plants outweighed a 3% drop for public works.  Nonresidential building was the one major construction group to register a year-to-date decline, falling 12%.  The nonresidential decline came as the result of this pattern by segment – commercial building, up a slight 0.5%; institutional building, down 16%; and manufacturing building, down 29%.  The year-to-date decline for nonresidential building has been getting smaller as 2012 has proceeded.

By geography, total construction starts during the first nine months of 2012 showed a large gain for the South Atlantic, up 33%; with much of the upward push coming from the start of two massive nuclear power projects in Georgia and South Carolina.  If these two projects are excluded, then total construction starts in the South Atlantic would be up 6%.  Year-to-date gains for total construction were also reported for the Midwest, up 6%; and the South Central, up 2%.  Two regions registered year-to-date declines for total construction – the Northeast, down 5%; and the West, down 9%.

About McGraw-Hill Construction:
McGraw-Hill Construction connects people, projects, and products across the construction industry. For more than a century, it has remained North America's leading provider of project and product information, plans and specifications, and industry news, trends, and forecasts. McGraw-Hill Construction serves more than one million customers in the global construction industry through Dodge, Sweets, Architectural Record, Engineering News-Record, GreenSource, and SNAP. To learn more, visit www.construction.com or follow https://twitter.com/mhconstruction.

About The McGraw-Hill Companies:
McGraw-Hill announced on September 12, 2011, its intention to separate into two public companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial's leading brands include Standard & Poor's Ratings Services, S&P Capital IQ, S&P Indices, Platts energy information services, and J.D. Power and Associates. With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.

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November Construction Slips 5 Percent

Schools and Universities to Continue Investment in New & Retrofit Green Building at High Levels, According to New McGraw-Hill Construction Study
November 14, 2012 - New York, NY

Health and well-being are as important as cost savings in driving the green education market; More than 75% of respondents cite both factors as key drivers for green building in the education sector

According to a new study by McGraw-Hill Construction, both K-12 and universities plan to continue investments in green schools, citing financial and social benefits.

The New & Retrofit Green Schools study shows social benefits, such as improved health and productivity, are critical drivers for the education sector and equally as important as financial drivers.

"Over 75 percent of respondents consider improving indoor air quality and enhancing health and well being as key drivers, which is nearly the same percentage that cite financial benefits, such as lower operating costs and reduced energy use," said Harvey Bernstein, vice president, Industry Insights and Alliances for McGraw-Hill Construction. "In the K-12 sector, social factors are particularly prominent, with over 75% of respondents also citing increased student performance as an important element of their decision to build green. Aside from the real benefits to our young people in their development, this is also particularly important at driving future green building growth, as our next generation of construction industry professionals learn practices that will become embedded into the design and construction of all buildings in the future."

Improved test scores, reported by 70 percent of K-12 respondents;Increased enrollment, reported by 39 percent of higher education respondents;Increased reputation, reported by 65 percent of higher education;Positive impact on student health and well-being, reported by all K-12 respondents and 90 percent of higher education respondents

The study also shows that cost savings are critically important to the education sector, as they are to all other sectors. Over 75 percent of respondents in both K-12 and higher education report that reducing energy use, operational savings, and improving 10-year operating costs are important reasons that have led them to build green. Financially, 58 percent of administrators, facility managers and school design, and construction and real estate staffs at K-12 schools report decreased energy use in their green buildings, and 55 percent cite lower annual costs. For higher education, the financial benefits equate to 55 percent of respondents reporting decreased energy use and 46 percent reporting lower annual costs.

"At Lutron, we’re committed to sustainable buildings," said Gerard Darville, director of the energy business unit, "This research shows that the market is looking for tangible benefits from their building improvement investments, and our suite of wireless control solutions, including lighting controls, sensors and automated shades, can be easily retrofitted into any school or building, offering energy savings and enhanced comfort in the space. These wireless control solutions also make the spaces more versatile and allow for easy reconfiguration without disruption to the students," said Darville.

In addition, 81 percent of the respondents for the K-12 sector report doing at least some new green projects over the last three years, and 84 percent report doing green renovations.

"The findings captured in the study provide a roadmap to the Center and our partners for accelerating our movement to ensure that every student has the opportunity to learn in a safe, healthy and efficient place," said Rachel Gutter, director of the Center for Green Schools at the U.S. Green Building Council. "If we are going to chip away at the $400 billion deferred maintenance bill for U.S. schools and universities, we have to understand with absolute clarity what the challenges school administrators and designers face, as well as the opportunities before them."

The need for better measures, more consistently applied, to gauge the impact of green building in the future was also unveiled in the study. Over 40 percent of both the K-12 and higher education respondents do not know the longer-term impact of their build improvements.

"We have seen this same trend in the industry: the challenge of being able to quantify the real benefits of sustainable practices in terms that matter most to schools, which is why we have been so focused on modeling and proving those benefits as essential ingredients for superior student and staff performance," said Marijke A. Smit, vice president, Strategic Partnerships at Project Frog. "Through our component building systems, we can provide replicable and measurable results of the benefits of sustainability as a powerful driver of better, healthier, learning environments that are more cost effective to operate and show added benefits to schools by increasing student attendance and performance."

The study was produced with the support of the U.S. Green Building Council Center for Green Schools, Lutron, Project Frog and Siemens. Survey and data partners included the Council of Educational Facility Planners International, The American Institute of Architects, Associated General Contractors of America, Green Schools National Network, National Association of Independent Schools, Society for Colleges and University Planning, and Second Nature.

Key findings of the study will be presented today at 5:00 p.m. at McGraw-Hill Construction’s Exhibit Booth #3539 in the North Hall of the Moscone Center at the Greenbuild Expo in San Francisco. The U.S. Green Building Council will be holding a discussion panel at 11:00 a.m. Thursday morning at the Center for Green Schools booth in the lower level of the North building outside the expo hall.

For more key findings from the New & Retrofit Green Schools study, visit http://bit.ly/Upg7ku. The full report containing these and other study results will be published as part of McGraw-Hill Construction’s SmartMarket Report series in the first quarter of 2013.

###
About McGraw-Hill Construction:
McGraw-Hill Construction’s data, analytics, and media businesses—Dodge, Sweets, Architectural Record, GreenSource, and Engineering News-Record— create opportunities for owners, architects, engineers, contractors, building product manufacturers, and distributors to strengthen their market position, size their markets, prioritize prospects, and target and build relationships that will win more business. McGraw-Hill Construction serves more than one million customers through its trends and forecasts, industry news, and leading platform of construction data, benchmarks, and analytics. To learn more, visit www.construction.com.

About The McGraw-Hill Companies:
McGraw-Hill announced on September 12, 2011, its intention to separate into two companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial's leading brands include Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, J.D. Power and Associates and Platts, a leader in commodities information.  With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.

Media Contact:
Kathy Malangone, Senior Director, Marketing Communications,
McGraw-Hill Construction, +1 212-904-4376, kathy_malangone@mcgraw-hill.com

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November Construction Retreats 11 Percent

Press Release

November Construction Retreats 11 Percent

New York, N.Y. – December 19, 2013 – At a seasonally adjusted annual rate of $524.8 billion, new construction starts in November fell 11% from the previous month, according to McGraw Hill Construction, a division of McGraw Hill Financial.  The downturn followed heightened activity in October, which showed the strongest pace for construction starts so far during 2013.  Both nonresidential building and nonbuilding construction pulled back from their elevated October amounts.  At the same time, residential building showed modest growth in November, continuing the steady upward trend that’s been present during most of 2013.  For the first eleven months of 2013, total construction starts on an unadjusted basis came in at $475.3 billion, up 6% from the same period a year ago.  If the volatile electric utility category is excluded from the year-to-date statistics, total construction starts for the first eleven months of 2013 would be up 14%.

November’s data produced a reading of 111 for the Dodge Index (2000=100), compared to 125 in October and 118 in September.  For the first eight months of 2013 the Dodge Index had averaged 105, as it hovered within the fairly narrow range of 100 to 108.  While November showed a decline from the prior two months, the level of activity was still above what had been reported earlier in the year.  “The monthly construction start statistics will often show an up-and-down pattern, given the amount of large projects that are included in any given month,” stated Robert A. Murray, chief economist for McGraw Hill Construction.  “Although November witnessed a decline from the heightened activity in September and October, the construction start statistics when viewed in the context of 2013 as a whole are still trending upward.  Housing during 2013 has strengthened on a consistent basis.  Nonresidential building is gaining momentum, aided by improving activity for commercial building from low levels while the institutional building sector stabilizes after a lengthy decline.  Nonbuilding construction is weakening due to a sharply reduced amount of new electric utility starts, but its public works component has shown surprising resilience this year.  For 2014, the upward trend for total construction starts is expected to continue.  One plus for construction and the economy going forward is the recent budget pact approved by the U.S. Congress, since it removes the uncertainty that would have come with the threat of another government shutdown in early 2014.”

Nonresidential building in November dropped 17% to $179.3 billion (annual rate), following its elevated activity in October.  The manufacturing plant category plunged 86%, after being lifted in October by the start of three massive projects each valued in excess of $1 billion.  In contrast, the largest manufacturing-related projects reported as November starts were a $94 million biotechnology plant in North Carolina and a $75 million pipe and tube plant in Texas.  Excluding the manufacturing category, nonresidential building in November would have been up 16%, supported by the month’s 31% jump for the commercial building group.  Hotel construction in November surged 212%, boosted by $476 million for the hotel portion of the $700 million 67-story Korean Air Hotel in Los Angeles CA.  Also reported as a November start was $191 million for the hotel portion of a $300 million hotel resort and casino in Durant OK.  Office construction in November climbed 26%, maintaining the growing momentum that’s been present during the second half of 2013.  Large office projects reported as November starts were the $336 million Transbay office tower in San Francisco CA, the $265 million State Farm office complex in Tempe AZ, and $160 million for the office portion of the $700 million Korean Air Hotel project in Los Angeles CA.  Warehouse construction was particularly strong in November, advancing 82% with the help of such projects as a $90 million distribution facility in Union OH and an $85 million Amazon distribution center in Kenosha WI.  Store construction was the one commercial category to decline in November, dropping 23% with the largest project being a $45 million outlet mall in Tejon Ranch CA.

 The institutional building group in November slipped 3%.  Healthcare facilities fell 41%, sliding back for the second month in a row after a particularly strong amount in September.  The largest healthcare facility projects reported as November starts were a $136 million hospital in Chicago IL and a $90 million hospital expansion in Long Island City NY.  The educational building category in November decreased 8% from its improved pace in October, with the largest education-related projects being a $125 million museum expansion in Potomac MD and a $100 million research facility in Maywood IL.  The smaller institutional categories showed strong percentage gains in November after a generally weak October.  Amusement-related construction advanced 84%, led by the start of the $763 million Vikings Multipurpose Stadium in Minneapolis MN as well as $109 million for the casino portion of the $300 million hotel resort and casino in Durant OK.  Transportation terminal construction in November rose 13%, supported by $125 million for the redevelopment of the George Washington Bridge Bus Station in New York NY.  The public buildings and religious categories in November showed large percentage gains from very low October levels, rising 21% and 33% respectively.

 During the first eleven months of 2013, nonresidential building climbed 8% relative to the same period a year ago.  The commercial categories as a whole were up 16%, featuring these across-the-board gains – warehouses, up 32%; hotels, up 24%; office buildings, up 23%; and stores, up 1%.  The 2013 increase for stores was restrained by the comparison to 2012 that included the $400 million renovation to Macy’s flagship department store in New York NY.  The manufacturing building category year-to-date climbed 49%, helped especially by the three large manufacturing projects reported as October starts.  The institutional building group year-to-date was down 2%, with the two largest institutional categories performing as follows – educational buildings, unchanged from the previous year; and healthcare facilities, down 4%.  The smaller institutional categories showed this year-to-date pattern – amusement-related projects, up 24%; transportation terminals, up 5%; religious buildings, down 8%; and public buildings, down 23%.

 Nonbuilding construction, at $127.1 billion (annual rate), dropped 21% in November.  The public works portion of nonbuilding construction fell 23%, with the largest decline registered by bridge construction, down 73%.  The bridge category in October had been boosted by $2.8 billion for the start of structural work on the Tappan Zee Bridge replacement project across the Hudson River in the Tarrytown NY area. In November, the largest bridge project reported as a construction start was a $125 million bridge reconstruction project in Fall River MA.  Additional public works categories with November declines were highway construction, down 3%; and sewers, down 32%.  On the plus side, both river/harbor development and water supply construction showed improvement from a lackluster October, advancing 47% and 3% respectively.  The miscellaneous public works category, which includes such diverse project types as pipelines and mass transit, grew 8% in November with the help of the $300 million Keystone Pipeline Gulf Coast Expansion in Texas.  Electric utility construction in November edged up 1%, staying basically unchanged from its sharply reduced amount in October.  The largest electric utility project reported as a November start was a $400 million wind farm in the state of Washington.

 For the January-November period of 2013, nonbuilding construction was down 15% from a year ago.  After reaching a record high in current dollar terms back in 2012, the volume of new electric utility starts has fallen sharply in 2013, plunging 59% year-to-date.  Running counter has been the public works sector, posting year-to-date growth at 5%.  The largest increase was registered by bridge construction, up 41%, reflecting the start of several very large bridge projects over the course of 2013.  The substantial year-to-date gain for bridge construction was accompanied by a 9% increase for highway construction.  For environmental public works, year-to-date growth was reported for river/harbor development, up 25%; and water supply construction, up 10%; while sewer construction was unchanged from its 2012 amount.  The miscellaneous public works category dropped 20% year-to-date, as the dollar amount of pipeline projects retreated from the strong pace witnessed during 2012.

 Residential building in November improved 1% to $218.5 billion (annual rate).  The upward push came from the multifamily side of the housing market, which climbed 18%.  Large multifamily projects reported as November starts included a $450 million multifamily tower and the $126 million condominium portion of a $300 million condo hotel, both located in New York NY.  Also reaching groundbreaking in November were a $114 million multifamily tower in San Francisco CA, a $100 million apartment complex in Huntington Station NY, and a $100 million multifamily tower in Chicago IL.  Single family housing in November receded 3%, pulling back after a 4% gain in October.  The November pace for single family housing was still 12% above what was reported at the outset of 2013.

 During the first eleven months of 2013, residential building advanced 25% compared to a year ago.  Single family housing will come close to matching last year’s strong percentage gain (up 29%), reporting a 27% increase in this year’s January-November period.  By major region, single family housing showed this year-to-date performance – the South Atlantic, up 35%; the Midwest, up 29%; the West and Northeast, each up 26%; and the South Central, up 19%.  Multifamily housing year-to-date climbed 21%, a strong rate of increase although revealing some deceleration from the sharp rise (up 37%) reported for the full year 2012.  By major region, multifamily housing showed this year-to-date performance – the Northeast, up 43%; the Midwest, up 26%; the South Atlantic, up 22%; the West, up 11%; and the South Central, down 6%.  The top five metropolitan areas in terms of the dollar amount of multifamily starts year-to-date were – New York NY, up 47%; Boston MA, up 87%; Washington DC, up 9%; Miami FL, up 5%; and Los Angeles CA, down 24%.

 The 6% increase for total construction starts at the national level during the first eleven months of 2013 was supported by gains in three of the five major regions.  Leading the way was the Northeast, up 21%; followed by the Midwest, up 11%; and the West, up 9%.  Total construction starts in the South Central region were unchanged year-to-date, while the South Atlantic showed a 3% decline.  The South Atlantic shortfall reflected the comparison to the first eleven months of 2012 that included the start of two massive nuclear facilities.  If electric utilities are removed from the year-to-date construction statistics in the South Atlantic, then total construction for that region in 2013 would be up 21%. 

                                

About McGraw Hill Construction: McGraw Hill Construction provides essential data, news, insights, and intelligence to better inform construction professionals’ decisions and strengthen their market position. McGraw Hill Construction’s data, analytics, and media businesses – Dodge, Sweets, Architectural Record, and Engineering News-Record  – create opportunities for owners, architects, engineers, contractors, building product manufacturers, and distributors to strengthen their market position, size their markets, prioritize prospects, and target and build relationships that will win more business. McGraw Hill Construction serves more than one million customers through its trends and forecasts, industry news, and leading platform of construction data, benchmarks, and analytics, including Dodge MarketShare™, Dodge BuildShare®, and Dodge SpecShare®. Construction data is available for North American and global markets. To learn more, visit www.construction.com.

 About McGraw Hill Financial:  McGraw Hill Financial (NYSE: MHFI) is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics. The Company's iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, J.D. Power, and McGraw Hill Construction. The Company has approximately 17,000 employees in 27 countries. Additional information is available at www.mhfi.com.

 Media Contact:
Kathy Malangone, Senior Director, Communications:
McGraw Hill Construction, 212-904-4376, kathy.malangone@mhfi.com

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February Construction Slides 7 Percent

Press Release

February Construction Slides 7 Percent

NEW YORK – March 22, 2013 – At a seasonally adjusted annual rate of $435.4 billion, new construction starts in February dropped 7% from the previous month, according to McGraw-Hill Construction, a division of The McGraw-Hill Companies.  The loss of momentum was present in two of construction's three main sectors – nonresidential building and nonbuilding construction (public works and electric utilities).  Meanwhile, the housing sector in February continued to strengthen.  For the first two months of 2013, total construction starts on an unadjusted basis came in at $62.4 billion, up 5% from the same period a year ago.

The February statistics lowered the Dodge Index to 92 (2000=100), down from 99 in January.  For all of 2012, the Dodge Index averaged 99.  "Over the past year, the construction industry has shown signs of renewed expansion, but diminished activity in January and February indicates that the upward trend remains hesitant," stated Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction.  "The broad pattern for construction starts is dependent upon the performance of its main sectors, and right now only housing is strengthening in a sustained manner.  For nonresidential building, the commercial structure types are showing improvement, but the institutional side of the market is still being restrained by tight state and local budgets.  For nonbuilding construction, the public works categories are dealing with flat-to-reduced funding support from the federal government, and new electric utility starts are in the process of pulling back from the record pace reported last year.  While total construction starts are expected to see more growth in 2013, the gain will likely stay gradual as a result of this divergent behavior by construction's main sectors."

Nonresidential building in February retreated 6% to $139.7 billion (annual rate).  The manufacturing plant category, which can be volatile on a month-to-month basis, plunged 79%, given the absence of large projects reported as construction starts for the month.  While January had included a $550 million methanol plant and a $235 million cellulosic ethanol plant, the largest manufacturing project reported as a February start was a $22 million chemical and gas products warehouse in Florida.  For the institutional categories, education-related construction in February was unchanged from the previous month, at a pace down 6% from its average monthly amount during 2012.  February did include several large education-related projects, such as an $83 million research laboratory in Cambridge MA, a $75 million high school modernization in Auburn WA, and a $60 million renovation for the Boston University Law School building in Boston MA, but these were not enough to lift the educational building category.  Healthcare facilities construction in February slipped 5%, remaining at a lackluster volume despite the start of a $179 million ambulatory care center at Andrews Air Force Base in Maryland and a $97 million hospital renovation in New Orleans LA.  The smaller institutional categories in February showed these declines – public buildings, down 10%; churches, down 12%; and transportation terminals, down 27%.  The one institutional category that registered a February increase was amusement-related work, which rose 6%.

The commercial categories in February witnessed a mixed performance.  Office construction climbed 14%, boosted by several large projects.  These included the $192 million Social Security Administration's National Support Center in Urbana MD, a $150 million office tower in New York NY, and an $80 million technology center in Palm Bay FL.  Store construction in February rose 12%, reflecting the start of a $150 million town center shopping mall in Sarasota FL.  On the negative side, hotel construction in February retreated 19%, even with the start of a $165 million casino resort project in Lake Charles LA.  A steeper February decline was reported for commercial warehouse construction, which dropped 36%.

Nonbuilding construction, at $98.1 billion (annual rate), plunged 32% in February.  The electric power category fell sharply, plummeting 68% from its January pace, as February included the start of only one very large project – a $500 million transmission line in Minnesota and Wisconsin.  After registering consistently robust activity during the first half of 2012, electric utility construction is now seeing more of an up-and-down pattern, indicative of an emerging downward trend.  The public works categories overall in February dropped 25%, following the brief improvement in January.  New highway and bridge construction starts in February were down 31%, after being lifted in January by a $1.4 billion tunnel project in Norfolk VA and the $235 million upper deck replacement of the Verrazano-Narrows Bridge in New York NY.  The miscellaneous public works category (which includes site work, rail projects, and pipelines) fell 43% in February, given the absence of very large projects following a January that included a $240 million railroad hub in New Mexico.  River/harbor development also weakened in February, slipping 8%.  At the same time, water supply construction in February edged up 1%, and sewer construction climbed 19% with the help of these projects – a $255 million waste water treatment facility in Colorado, a $182 million garbage transfer station in New York, and a $91 million waste water system in Florida.  Murray noted, "Going forward, federal spending cuts under sequestration will restrain public works construction during 2013, although in a manner somewhat different from the pattern of construction starts in February.  Transportation-related public works were largely exempt from the spending cuts, while the EPA water infrastructure and the Corps of Engineers accounts were subject to reduced funding."

Residential building in February advanced 11% to $197.6 billion (annual rate), bouncing back after a modest pause in January and maintaining the upward trend that gained traction during 2012.  Multifamily housing had a particularly strong February, jumping 39% with the start of several very large projects – the $200 million multifamily portion of the Cira Center South project in Philadelphia PA, a $200 million apartment building in New York NY, and a $117 million residential tower at the Atlantic Yards development in Brooklyn NY.  Single family housing in February rose 5%, continuing to strengthen on a wide geographic basis.  By major region, single family housing in February showed gains in the South Atlantic, up 11%; the South Central and West, each up 4%; the Northeast, up 3%; and the Midwest, up 1%.  Murray stated, "This year's prospects for housing are bright, even with a sluggish economy.  The demand for single family housing is picking up, as shown by the improvement in home sales and home prices, while inventories are currently very low.  Multifamily housing continues to see rising occupancies and rents, and condominium projects are now joining the upward path that's already well-established for apartments."

The 5% gain for total construction starts on an unadjusted basis during the first two months of 2013, compared to 2012, was the result of a varied performance by major sector.  Residential building led the way, climbing 32% year-to-date, with single family housing up 35% and multifamily housing up 20%.  Nonresidential building in the first two months of 2013 was down 7% from last year.  While commercial building showed a year-to-date increase of 20%, weaker activity was reported for the manufacturing and institutional segments, each down 20%.  Nonbuilding construction during the first two months of 2013 dropped 9% from last year, as a 9% gain for public works was outweighed by a 53% decline for electric utilities.  By region, total construction starts for the January-February period of 2013 revealed this behavior compared to last year – the Northeast, up 25%; the South Atlantic, up 12%; the South Central, up 10%; the Midwest, down 2%; and the West, down 10%.

Useful perspective is also obtained by looking at twelve-month moving totals, in this case the twelve months ending February 2013 versus the twelve months ending February 2012.  On this basis, total construction starts were up 8%, as the result of the following performance by sector – residential building, up 31%; nonresidential building, down 8%; and nonbuilding construction, up 5%.  By region, the twelve months ending February 2013 showed this pattern for total construction compared to the prior twelve months – the South Atlantic, up 19%; the South Central, up 14%; the Northeast, up 10%; the Midwest, up 9%; and the West, down 7%.

About McGraw Hill Construction:
McGraw-Hill Construction connects people, projects, and products across the construction industry.  For more than a century, it has remained North America's leading provider of project and product information, plans and specifications, and industry news, trends, and forecasts.  McGraw-Hill Construction serves more than one million customers in the global construction industry through Dodge, Sweets, Architectural Record, Engineering News-Record, GreenSource, and SNAP.  To learn more, visit www.construction.com or follow @mhconstruction on Twitter.

About The McGraw Hill Companies:
The McGraw-Hill Companies (NYSE: MHP), a financial intelligence and education company, signed an agreement to sell its McGraw-Hill Education business to investment funds affiliated with Apollo Global Management, LLC in November 2012.  Following the sale closing, expected in early 2013, the Company will be renamed McGraw Hill Financial (subject to shareholder approval) and will be a powerhouse in benchmarks, content and analytics for the global capital and commodity markets. The Company's leading brands will include: Standard & Poor's, S&P Capital IQ, S&P Dow Jones Indices, Platts, Crisil, J.D. Power and Associates, McGraw-Hill Construction, and Aviation Week.  The Company will have approximately 17,000 employees in more than 30 countries.  Additional information is available at www.mcgraw-hill.com

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June Construction Retreats One Percent

Press Release

June Construction Retreats One Percent
July 20, 2012 - New York, NY

New construction starts in June slipped 1% to a seasonally adjusted annual rate of $446.1 billion, according to McGraw-Hill Construction, a division of The McGraw-Hill Companies.  After the elevated activity that was reported during March and April, which reflected the lift coming from two nuclear power projects, total construction in May and June returned to a level just slightly above the average monthly pace reported during the previous year. June featured a moderate loss of momentum for nonresidential building, after this sector's improved performance in May.  At the same time, residential building in June maintained its gradual upward trend, while nonbuilding construction was unchanged as the result of divergent behavior by its public works and electric utility segments.  For the first six months of 2012, total construction starts on an unadjusted basis came in at $225.0 billion, up 4% from the same period a year ago.

June's data produced a reading of 94 for the Dodge Index (2000=100), compared to a revised 95 for May.  For all of 2011, the Dodge Index averaged 92.  "The construction start statistics for the most part continue to hover within a set range, showing gains for some project types but further weakness for other project types," stated Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction.  "Total construction activity had jumped in March and April, due primarily to the start of two massive nuclear power projects – $8.5 billion for work on Units 3 and 4 at the Vogtle nuclear power facility near Waynesboro GA and another $8.5 billion for work on Units 2 and 3 at the Virgil C. Summer nuclear power facility near Jenkinsville SC.  Aside from the lift coming from this year's nuclear power projects, total construction activity during the first half of 2012 has basically shown a hesitant up-and-down pattern.  On the plus side, gains are being reported for several commercial building categories, and the strengthening trend for multifamily housing is now being joined by moderate growth for single family housing.  On the negative side, such institutional project types as educational buildings and healthcare facilities continue to weaken, along with further declines for several public works categories."

Nonresidential building in June fell 4% to $148.7 billion (annual rate), following its 12% increase in May.  For the commercial sector, office construction in June dropped 31% after jumping 34% in May, which benefitted from the start of several large data center and corporate headquarters projects.  The largest office projects that were reported as June starts were a $200 million data center in Kings Mountain NC, a $65 million office building in Arlington VA, and a $35 million renovation to one of the World Bank facilities in Washington DC.  Hotel construction was also down sharply in June, falling 23% after surging 49% in May.  Store construction in June grew 4%, helped by groundbreaking for a $52 million outlet mall in Rosemont IL and a $32 million outlet mall in Woodstock GA.  Warehouse construction in June managed to edge up 1%, aided by the start of a $78 million Family Dollar distribution center in Utah.  Manufacturing plant construction in June was down 10%, although June did include the start of several large projects – a $375 million petrochemical plant expansion in Louisiana, a $196 million pharmaceutical research facility in Massachusetts, and a $135 million construction equipment manufacturing plant in Georgia.

The institutional sector in June showed a mixed performance by project type.  The educational building category grew 4%, helped by such June projects as a $166 million research center at the University of Chicago in Chicago IL, a $101 million technical school in Danvers MA, and an $80 million building at Northwestern University in Evanston IL.  Healthcare facilities in June climbed 13%, supported by such projects as a $300 million hospital tower in Columbus OH, a $130 million hospital in Morganton NC, and a $113 million hospital addition in Boulder CO.  While both the education and healthcare categories showed gains in June relative to May, for each category the level of activity in June was still below its average monthly pace for 2011, with educational buildings down 8% and healthcare facilities down 11%.  For the smaller institutional categories, amusement-related construction advanced 43% in June from a very weak May, lifted by the start of such projects as an $80 million sports arena in Anchorage AK and a $42 million casino in Laveen AZ.  Church construction was also up from a very weak May, rising 41%.  June declines were reported for the public buildings category (detention facilities and courthouses), down 13%; and transportation terminals, down 40%.

During the first six months of 2012, nonresidential building fell 16% from a year ago.  The year-to-date decline for nonresidential building has been getting smaller as 2012 has progressed, although it still reflects the comparison to the briefly elevated amount during the first half of 2011, which included such projects as the $1.2 billion redevelopment of the Delta Terminal at New York's JFK International Airport and the $1.1 billon National Security Agency data center in Utah.  The commercial categories year-to-date dropped 4%, pulled down by a 24% decline for office construction.  If last year's $1.1 billion data center in Utah is excluded from the comparison, then commercial building in 2012's first half would be unchanged and office construction would be down a less pronounced 15%.  The other commercial categories showed gains for the first half of 2012 versus last year – stores and hotels, each up 7%, and warehouses up 12%.  Manufacturing plant construction in the first six months of 2012 dropped 28% from a year ago.  The institutional categories in the January-June period of 2012 came in 20% below last year, including declines of 16% for educational buildings and 19% for healthcare facilities.

Residential building, at $163.7 billion (annual rate), increased 1% in June compared to May.  The upward push was provided by multifamily housing, which increased 5% in June on top of its 30% surge in May.  Large multifamily projects that reached groundbreaking in June were led by the following – a $211 million apartment building in New York NY, a $147 million apartment complex in Weehawken NJ, the $144 million apartment portion of a mixed-use building in Hollywood CA, and a $139 million apartment building in Los Angeles CA.  Single family housing in June was unchanged from May, essentially stabilizing after registering gains during the first five months of 2012.  The June pace for both sides of the housing market were considerably above their respective monthly averages during 2011, with multifamily housing up 45% and single family housing up 26% on this basis.

At the six-month mark of 2012, residential building in dollar terms advanced 25% from the first half of 2011, with multifamily housing climbing 32% while single family housing grew 23%.  The top five multifamily markets by metropolitan area during the first half of 2012  ranked by the dollar amount of new projects, were the following (with the percent change from a year ago) – New York NY, up 88%; Washington DC, down 19%; Los Angeles CA, up 27%; Dallas-Ft. Worth TX, up 40%; and Boston MA, up 14%.  For single family housing, the year-to-date gains were widespread by geography, with all five major regions of the U.S. reporting double-digit increases relative to a year ago – the West, up 32%; the Midwest, up 26%; the South Atlantic, up 21%; the South Central, up 20%; and the Northeast, up 12%.

Nonbuilding construction, at $133.7 billion (annual rate), was unchanged in June relative to May, as the result of a sharp increase for the public works sector offsetting a steep decline for electric utilities.  Public works construction climbed 26% in June, led by a 129% surge for the "other public works" category, which includes such diverse project types as site work, mass transit, pipelines, and outdoor sports stadiums.  A major boost to the "other public works" category in June was provided by $1.0 billion estimated for work on a new football stadium for the San Francisco 49ers in Santa Clara CA.  Also noteworthy "other public works" projects in June included $280 million for rail transit work in Fremont CA and $225 million for site work at Governor's Island in New York NY.  Bridge construction in June climbed 25%, supported by $386 million for work on the West Oahu Farrington Highway Guideway project in Honolulu HI, while highway construction in June improved 3%.  The environmental public works categories in June showed the following performance – river/harbor development, up 3%; sewers, unchanged; and water supply systems, down 10%.  Electric utility construction in June plunged 60%, sliding from the heightened activity that was reported earlier in 2012.  Even with this steep decline, electric utility construction in June still included the start of three large wind power projects, located in Colorado ($670 million), North Dakota ($314 million), and Alaska ($65 million).

For the first six months of 2012, nonbuilding construction was up 11% compared to last year.  The electric utility category grew 30% year-to-date, in particular reflecting the start of the Vogtle and Summer nuclear power projects in March and April.  Public works construction registered a 1% year-to-date gain, due mostly to a 58% jump for the "other public works" category from its depressed amount during the first half of 2011.  Modest 2012 year-to-date gains were reported for bridges and sewer construction, each up 2%.  Decreased year-to-date activity was reported for highways, down 12%; accompanied by declines for water supply systems, down 10%; and river/harbor development, down 15%.

The 4% gain for total construction starts at the U.S. level during the first six months of 2012 was due to a varied pattern by geography.  The South Atlantic region advanced 50% year-to-date, lifted by work at the nuclear power facilities in Georgia and South Carolina.  Total construction starts in the Midwest were up 6%, but year-to-date declines were reported in the West, down 9%; and in the South Central and Northeast, each down 10%.

About McGraw-Hill Construction:
McGraw-Hill Construction connects people, projects, and products across the construction industry. For more than a century, it has remained North America's leading provider of project and product information, plans and specifications, and industry news, trends, and forecasts. McGraw-Hill Construction serves more than one million customers in the global construction industry through Dodge, Sweets, Architectural Record, Engineering News-Record, GreenSource, and SNAP. To learn more, visit www.construction.com or follow @mhconstruction on Twitter.

About The McGraw-Hill Companies:
McGraw-Hill announced on September 12, 2011, its intention to separate into two public companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial's leading brands include Standard & Poor's Ratings Services, S&P Capital IQ, S&P Indices, Platts energy information services, and J.D. Power and Associates. With sales of $6.2 billion in 2011, the Corporation has approximately 23,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.

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September Construction Climbs 13 Percent

Press Release

September Construction Climbs 13 Percent

New York, N.Y. – October 16, 2013 – New construction starts in September advanced 13% to a seasonally adjusted annual rate of $556.0 billion, according to McGraw Hill Construction, a division of McGraw Hill Financial.  Nonresidential building bounced back after losing momentum in August, and the nonbuilding construction sector was lifted by the start of several large power plants, which ran counter to the sharply downward trend for electric utilities that’s been present during 2013.  For the first nine months of 2013, total construction starts on an unadjusted basis were reported at $379.3 billion, up 2% from the same period a year ago.  If electric utilities are excluded from the year-to-date statistics, total construction starts in the first nine months of 2013 would be up 11%.

The September data raised the Dodge Index to 118 (2000=100), up from 104 in August and the highest reading for the Index so far in 2013.  From January through August this year, the Index had hovered within the fairly narrow range of 98 to 107.  “The overall level of construction activity will be affected by the presence of large projects in any one given month, and that was certainly the case in September,” stated Robert A. Murray, vice president of economic affairs for McGraw Hill Construction.  “While the extent of September’s gain overstates the current health of construction, the latest month did provide positive news for nonresidential building which continued the up-and-down pattern that’s occurred during 2013.  The September gain for nonresidential building reflected the manufacturing plant category posting a strong increase, commercial building staying close to its recently improved pace, and several institutional structure types rising from previously weak levels.  After the downward trend that’s been underway from 2009 through the first half of 2013, the institutional building sector may now be starting to stabilize, which is necessary for total nonresidential building to register growth.  At the same time, the recent Congressional impasse over federal appropriations for fiscal 2014 and raising the debt ceiling only adds to the sense of uncertainty, which hampers renewed expansion for nonresidential building going forward.”

Nonresidential building in September jumped 24% to $182.8 billion (annual rate).  The manufacturing plant category soared 289%, boosted by an $800 million ammonia production facility and a $615 million steel mill, both located in Louisiana.  Commercial building in September receded 3% following its 4% gain in August, due to a mixed pattern by project type.  Hotel construction in September increased 9%, supported by the start of a $75 million hotel resort in Anaheim CA, while office construction edged up 1%.  Large office projects that reached groundbreaking in September included a $435 million office campus for Facebook in Menlo Park CA, a $139 million county government office building in Van Nuys CA, and a $129 million renovation of a financial services office building in Des Moines IA.  Store construction in September held steady with its August amount, helped by $75 million for the retail portion of the $460 million Millennium Tower mixed-use building in Boston MA.  The commercial building total in September was pulled down by a 34% drop for warehouse construction.

Institutional building in September advanced 24%, rebounding after a 17% decline in August.  The healthcare facilities category, which has been lackluster for much of 2013, jumped 144%.  There were four large hospital projects that reached groundbreaking in September – a $437 million replacement hospital at Fort Bliss in El Paso TX, a $323 million cancer treatment center in Omaha NE, a $250 million hospital tower in Oak Lawn IL, and a $200 million medical center in Birmingham AL.  The educational building category in September grew 13%, aided by these projects – a $93 million two-building complex at Montclair State University in Montclair NJ, an $82 million public library in Austin TX, and a $74 million teaching and learning center at U.C.L.A. in Los Angeles CA.  For the smaller institutional categories, both public buildings and churches showed improvement in August, climbing 36% and 18% respectively.  Decreased activity in September was reported for amusement-related projects, down 27%; and transportation terminals, down 46%.

Nonbuilding construction, at $169.9 billion (annual rate), increased 33% in September.  Electric utility construction surged 466% after a weak August, departing from the declining trend experienced during most of 2013.  Large electric utility projects that reached the construction start stage in September included a $1.9 billion wind energy farm in Iowa, a $1.1 billion natural gas power plant in Virginia, a $700 million solar power facility in Nevada, and a $260 million transmission line grid in New Jersey.  The public works categories combined dropped 4% in September, as bridge construction fell a steep 61% from its elevated August amount, which included several very large projects.  The remaining public works categories in September showed gains relative to August.  River/harbor development jumped 55%, lifted by $615 million for canal work in the New Orleans LA area.  Sewer construction advanced 23%, while water supply systems increased 12%.  The miscellaneous public works category, which includes site work, rose 13% in September with the support of $360 million for site work at the planned Manhattan West complex in New York NY.

Residential building in September dropped 6% to $203.2 billion (annual rate).  Multifamily housing fell 14%, pulling back after rising by the same percentage during August.  Large multifamily projects that reached groundbreaking during September included the following – $334 million for the multifamily portion of the Millennium Tower mixed-use project in Boston MA, a $157 million multifamily tower in Long Island City NY, a $133 million multifamily tower in Chicago IL, and a $120 million multifamily tower in Boston.  Through the first nine months of 2013, the leading metropolitan areas for multifamily construction starts (ranked by dollar volume) were the following – New York NY, Boston MA, Washington DC, Miami FL, and Los Angeles CA.  Single family housing in September slipped 3%, registering its first month-to-month decline in dollar terms since January.  The September level of activity for single family housing was still healthy by recent standards – up 9% from January and 27% higher than the average monthly pace reported during 2012.  By geography, single family housing in September showed modest declines in all five regions – the Midwest, down 1%; the South Atlantic, down 2%; the Northeast, down 3%; the South Central, down 4%; and the West, down 5%.

The 2% gain for total construction starts on an unadjusted basis during the January-September period of 2013 reflected a mixed pattern by the three main construction sectors.  Nonresidential building matched the amount reported during last year’s first nine months, due to this behavior by segment – commercial building, up 9%; manufacturing building, up 1%; and institutional building, down 5%.  Nonbuilding construction year-to-date fell 20%, as a 63% plunge for electric utilities far outweighed a slight 2% gain for public works.  Residential building advanced 26% year-to-date, with single family housing up 29% and multifamily housing up 17%.

By geography, total construction starts during the first nine months of 2013 showed gains in three of the five major regions – the Northeast, up 13%; the West, up 7%; and the Midwest, up 6%.  The South Central retreated 2%, while the South Atlantic dropped 10%.  The South Atlantic decline reflected the comparison to the first nine months of 2012 that included the start of two large nuclear facilities.  If electric utilities are excluded from the year-to-date construction statistics in the South Atlantic, then total construction for that region in 2013 would show a 16% gain.

About McGraw Hill Construction:
McGraw Hill Construction provides essential data, news, insights, and intelligence to better inform construction professionals’ decisions and strengthen their market position. McGraw Hill Construction’s data, analytics, and media businesses – Dodge, Sweets, Architectural Record, and Engineering News-Record – create opportunities for owners, architects, engineers, contractors, building product manufacturers, and distributors to strengthen their market position, size their markets, prioritize prospects, and target and build relationships that will win more business. McGraw Hill Construction serves more than one million customers through its trends and forecasts, industry news, and leading platform of construction data, benchmarks, and analytics, including Dodge MarketShare™, Dodge BuildShare® and Dodge SpecShare®. Construction data is available for North American and global markets.  To learn more, visit www.construction.com.

About McGraw Hill Financial:
McGraw Hill Financial (NYSE: MHFI) is a leading financial intelligence company providing the global capital and commodity markets with independent benchmarks, credit ratings, portfolio and enterprise risk solutions, and analytics.  The Company's iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, J.D. Power, and McGraw Hill Construction.  The Company has approximately 17,000 employees in 27 countries.  Additional information is available at www.mhfi.com.

Media Contact:
Kathy Malangone, Senior Director, Communications:
McGraw Hill Construction, 212-904-4376, kathy.malangone@mhfi.com

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