by Calculated Risk on 1/14/2020 09:01:00 AM

From Dodge Data Analytics: Dodge Momentum Index Moves Higher in December

The Dodge Momentum Index increased 1.5% in December to 156.2 (2000=100) from the revised November reading of 153.9. The Momentum Index, issued by Dodge Data & Analytics, is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. Both components of the Momentum Index rose over the month – the institutional component gained 2.3%, while the commercial component rose 0.9%.

For the full year, the Momentum Index averaged 141.9, a decline of 3.7% from 2018’s average. In 2019, the commercial component was 2.3% lower than the previous year, while the institutional component dropped 5.9%. Last year’s slip in the dollar value of projects entering planning suggests that construction spending for nonresidential buildings could see a setback in the year to come. However, the Momentum Index did end the year on a high note indicating that a decline in 2020 construction is likely to be modest in nature.
emphasis added

Click on graph for larger image.

This graph shows the Dodge Momentum Index since 2002. The index was at 156.2 in December, up from 153.9 in November.

According to Dodge, this index leads "construction spending for nonresidential buildings by a full year". After declining late 2018, this index moved mostly sideways in the first half of 2019, and increased recently. So this suggests a pickup in Commercial Real Estate in 2020.