Steel Products
Dodge Momentum Drops on Slowdown in Institutional Planning
Written by Becca Moczygemba
August 8, 2023
The Dodge Momentum Index (DMI) dropped in July due to varying trends in the commercial sector, according to the latest data from the Dodge Construction Network (DCN).
The DMI dropped 0.9% from June’s revised reading of 195.1 to 193.4 in July, but it was still 21% higher than the same time last year.
“While both segments of the index fell this month, underlying project data points to divergent trends in the nonresidential sector,” said Sarah Martin, associate director of forecasting for the Dodge Construction Network.
Commercial planning activity is down 10% from January 2023, Martin noted.
Conversely, institutional planning is up 16% in the same time period.
Large institutional projects in May inflated month-over-month trends, but have since tapered off.
The two largest institutional segments, healthcare and education, slowed down in July leaving a hole in the institutional sector.
Weaker commercial activity is expected in response to tighter lending standards and higher interest rates. However, institutional projects that are supported by public funding will help balance the remainder of 2023, Martin added.
Month-over-month, the commercial component of the DMI decreased by 0.2%, while the institutional component dropped by 1.9%. However, year-over-year the institutional component was up 35% and commercial component was up 13%.
Dodge is the leading index for commercial real estate, using the data of planned nonresidential building projects to track spending in the important steel consuming sector for the next 12 months. An interactive history of the DMI is available on our website.
Becca Moczygemba
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