Construction starts held steady in February, as gains in commercial projects helped counteract slowdowns in multifamily and manufacturing, according to Dodge Construction Network’s latest report. Despite a sluggish beginning to the year, the overall market remained stable, with total construction starts inching up 0.5% to a seasonally adjusted annual rate of $1.1 trillion.

The nonresidential sector saw a modest 2% increase, fueled by new office, hotel, and healthcare projects. Residential starts dipped by 1%, while infrastructure projects, including highways, bridges, and utility plants, remained largely unchanged.

“While increased uncertainty over the trajectory of monetary and fiscal policies may be informing some of the flat month-to-month trends — the largest construction sectors still saw growth in activity throughout February,” said Sarah Martin, associate director of forecasting at Dodge Construction Network. “Steady growth in planning activity throughout 2024 should support stronger construction starts in future months.”

However, challenges remain. Martin noted that developers should approach 2025 with caution, keeping an eye on rising material costs, ongoing supply chain issues, and labor shortages that could impact the industry’s momentum.

The 9 Largest Construction Starts in February

According to Dodge, the biggest projects that broke ground last month include:

1. John Glenn Columbus Airport Terminal – Columbus, Ohio ($1.8 billion)
2. Lyndon B. Johnson Hospital Replacement – Houston ($1.5 billion)
3. EverBank Stadium Renovation – Jacksonville, Florida ($1.45 billion)
4. Westshore Interchange Road Work – Tampa, Florida ($1.4 billion)
5. Kensico-Eastview Connection Tunnel and Shafts – Valhalla, New York ($1.1 billion)
6. Aratina Solar Farm – Boron, California ($1 billion)
7. The Residences at 1428 Brickell Condominiums – Miami ($478 million)
8. Highbridge Apartment Building – Highbridge, New York ($335 million)
9. Tower 2 at The Standard Residences Brickell – Miami ($265 million)

Commercial Sector Rebounds Despite Manufacturing Slump

February saw a strong 22% increase in commercial groundbreakings, driven by a surge in office, hotel, and parking garage projects. Institutional construction, which had surged in January due to a spike in hospital projects, cooled slightly with a 2% decline. Meanwhile, manufacturing starts experienced a sharp 48% drop.

Year-to-date, nonresidential construction has declined by 14% compared to the same period in 2024. Commercial construction is down 8%, while institutional starts have risen by 11%.

Infrastructure projects showed mixed results. Highway and bridge construction starts climbed 8%, alongside gains in environmental public works projects. However, utility and gas projects took a hit, dropping 21% in February.

Despite the monthly fluctuations, year-to-date nonbuilding construction is up 16%, thanks to a 68% surge in utility and gas projects and a 20% increase in highway and bridge work.

Residential Sector: Single-Family Holds, Multifamily Drops

Multifamily construction continued to struggle, with starts falling 6% in February. In contrast, single-family groundbreakings rose 1%, signaling a possible shift in the housing market.

Through the first two months of 2025, single-family starts are up 2% year-over-year, while multifamily construction has declined 11%, continuing a trend of slower growth in the apartment sector.

As the year progresses, construction firms will be keeping a close watch on economic conditions, interest rate shifts, and federal infrastructure funding, which could shape industry performance for the remainder of 2025.

Originally reported by Sebastian Obando in Construction Dive.