Leading Index for Commercial Real Estate "Slips" in August

Note: This index is possibly a leading indicator for new non-residential Commercial Real Estate (CRE) investment, except manufacturing.

From Dodge Data Analytics: Dodge Momentum Index Slips in August

The Dodge Momentum Index moved lower in August, falling 2.4% to 129.1 (2000=100) from its revised July reading of 132.2. The Momentum Index 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. The decline in August can be attributed to an 8.7% drop in the commercial component of the Momentum Index, while the institutional component rose 7.3%. The commercial component has seen a steep rise over the past year as large projects – particularly office buildings – entered the planning cycle. The August retreat for the commercial component brings planning activity back to a level more consistent with a sustainable pace of development.
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This graph shows the Dodge Momentum Index since 2002. The index was at 129.1 in August, down from 132.2 in July.

The index is only up 1.4% year-over-year.

According to Dodge, this index leads "construction spending for nonresidential buildings by a full year". This suggests some further increases in CRE spending over the next year.