Institutional construction starts declined by 1% according to Dodge, largely due to a downturn in educational facility projects. Notable non-residential developments beginning in August included the $880-million Geisinger Medical Center Tower in Danville, Pennsylvania, and the $666-million Fort Meade East Campus Office Building in Maryland.
Year-to-date non-building construction rose 8%, driven by a 13% increase in utility projects and an 8% growth in highway and bridge work. Environmental public works, primarily water and sewer infrastructure, dipped 3% after several years of expansion. Major non-building launches included the $5.1-billion Woodside Louisiana LNG Facility (Train 3, Phase 1) in Sulphur, Louisiana, and the $2.9-billion Cheniere Corpus Christi LNG Facility (Trains 8 and 9, Stage 3B) in Gregory, Texas.
Construction material prices are rising, attributed to current tariff policies. Michael Guckes, chief economist at ConstructConnect, noted that while prices were flat or slightly lower last year, recent months have seen inflation in materials exceed 5% as of August. Although steel, aluminum, and lumber have drawn media attention, their import share relative to domestic consumption is limited. In contrast, items like control panels, nuts, bolts, and screws—mostly imported—are more likely to pass full tariff costs to U.S. buyers.
S&P Global Market Intelligence forecasts rebar prices to rise 4.9% in 2025 before falling 1.8% in 2026. Structural steel is expected to increase 3.8% this year, followed by a 6.1% decline next year. John Anton, economics director at S&P Global, explained that after sharp tariff-driven increases, steel prices are now gradually retreating as producers cautiously align output with construction demand.
— news from Engineering News-Record | ENR
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3Q 2025 Cost Report: Construction Growth Stalls Amid Economic Concerns
Institutional starts fell 1%, according to Dodge, which Martin notes as primarily owed to a drop in the education sector. Overall, the largest non-residential projects to start work in August were the $880-million Geisinger Medical Center Tower in Danville, Pa., and the $666-million Fort Meade East Campus Office Building in Fort Meade, Md. n nNon-building starts increased 8% year-to-date, spurred by utilities and highway and bridge construction, up 13% and 8%, respectively. Environmental public works, mostly consisting of water and sewer construction, fell 3%, after strong growth for several years prior. Among the largest non-building projects to break ground in August were the $5.1-billion Woodside Louisiana LNG Facility [Train 3, Phase 1] in Sulphur, La., and the $2.9-billion Cheniere Corpus Christi LNG Facility [Trains 8 and 9, Stage 3B] in Gregory, Texas. n nTariffs Cause Materials Price Hike n n“We appear to be in the early innings of a jump in construction prices, which is not particularly surprising given the administration’s current tariff policy,” says Michael Guckes, chief economist at ConstructConnect. “Last year, prices were flat to slightly down, according to the Bureau of Labor Statistics. In the most recent months, however, we have seen construction materials inflation jump to over 5% [as of August].” n nHe adds: “While the focus in the news earlier this year was on steel, aluminum and lumber tariffs among others, these products don’t have particularly high levels of imports relative to total U.S. consumption. On the other hand, products such as control panels and nuts, bolts and screws are majority supplied by importers and for this reason are more likely to see tariff costs largely—or even wholly— passed along to U.S. consumers.” n nAs for steel, S&P Global Market Intelligence’s third quarter forecast predicts rebar prices will rise 4.9% in 2025 before falling 1.8% in 2026, while structural shapes are forecast to increase 3.8% this year, with a 6.1% drop expected next year. “Prices for rebar, structurals and other construction steel grades will trend downward in the United States,” says John Anton, economics director at S&P Global Market Intelligence. “Prices rose sharply on tariffs and are now in a bit of a give-back. Declines will be slow as mills are being careful to try and match output to construction demand.”