Some new numbers on the metro-area’s construction market were released by McGraw-Hill Construction Wednesday. At first blush, they seem rather dire.
Contracts for future construction of nonresidential buildings in the 13-county metro decreased nine percent to $163 million in February, when compared with the same period last year. This includes commercial, manufacturing, educational, religious, administrative, recreational, hotel, dormitory and other buildings. Year to date on a cumulative basis, contracts for future construction declined 29 percent to $215 million.
Meanwhile, February contracts for residential projects declined 37 percent to $74 million, when compared to February 2011, according to McGraw-Hill. Year-to-date residential contracts declined by 13 percent to $154 million.
But Herb Tousely, director of the University of St. Thomas’ Shenehon Center for Real Estate, cautions against making snap decisions based on the data. Construction is seasonal, he notes. “When the weather gets nice, permits will be pulled and more contracts let,” he said. “You don’t see a lot of activity in January or February, it should pick up in March and April.”
No one in the building trades, it seems, could have predicted such a warm winter, either. Then again, who could?
Janet Moore covers commercial real estate for the Star Tribune.