Construction Starts Rebound 25.6% in July

Total construction starts popped 25.6% in July to a seasonally adjusted annual rate of $1.79 trillion, according to Dodge Construction Network. Nonresidential building starts jumped 57.7%, residential starts increased 4.9% over the month and nonbuilding climbed 2.2%. On a year-to-date basis, total construction starts were up 16.9% through July. Nonresidential starts were up 21.9%, nonbuilding starts improved by 29.8% and residential starts were down 1.7% over the same period. For the 12 months ending July 2026, total construction starts were up 14.4% from the 12 months ending July 2025. Residential starts were down 2.7%, nonresidential starts were up 14.8% and nonbuilding starts were up 32.1%.

“Megaproject driven volatility headlines a disjointed construction market,” stated Eric Gaus, chief economist at Dodge Construction Network. “There is strength in pockets, multifamily within residential, data centers within commercial, energy within non-building, but also verticals struggling to stabilize.”

Nonresidential building starts jumped 57.7% in July to a seasonally adjusted annual rate of $917 billion. Commercial starts were up 70.0% over the month. Offices and data centers, more than doubled (+107.9% m/m), offsetting weaker warehouse growth (+1.0% m/m) and declining hotels (-51.5% m/m),  parking garages (-19.4% m/m) and retail stores (-9.5% m/m). Institutional starts improved 6.2% over the month, supported by a 4.5% m/m uptick in education and dormitory starts, as well as a 45.7% m/m gain in other institutional starts. Healthcare facilities doubled down on their losses, falling another 59.7% in July. Manufacturing construction starts bounced back with 277.8% m/m, continuing a volatile streak. On a year-to-date basis through July, nonresidential starts are up 21.9%. Commercial and industrial construction gained 44.2%, while institutional starts are down 3.5% over the same period.

For the 12 months ending July 2026, total nonresidential starts were up 14.8% compared to the 12 months ending July 2025. Commercial starts were up 45.2%, institutional starts decreased 5.6% and manufacturing starts were down 1.5% over the same period.

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