Pandemic Fuels Commercial and Multifamily Construction Starts Decline in 2020

January 28, 2021

Pandemic Fuels Commercial and Multifamily Construction Starts Decline in 2020

The value of commercial and multifamily construction starts in the top 20 metropolitan areas throughout the U.S. lost 23% in 2020, falling to $111.1 billion according to Dodge Data & Analytics.

Nationally, commercial and multifamily starts tumbled 20% over the year to $193.4 billion. Commercial and multifamily construction starts in the top 10 metro areas dropped 23% during the year with only one metro area —Phoenix AZ — reporting an increase. In the second largest group of metro areas (those ranked 11 through 20), commercial and multifamily construction starts also lost 23%, with only Denver CO and Kansas City MO posting an increase for the year. 

The New York metropolitan area continued to be the largest market for commercial and multifamily starts at $23.5 billion but suffered a stark 25% decline from 2019. The Washington DC metro area managed to maintain its second place standing despite an identical decline in 2020 lowering commercial and multifamily starts to $8.9 billion.

The Los Angeles CA metro area, which fell 21% to $7.4 billion, ranked third. The remaining top 10 metropolitan areas in 2020 were Dallas TX down 20% ($6.8 billion), Chicago IL down 9% ($6.4 billion), Boston MA 27% lower ($6.3 billion), Phoenix up 32% ($5.3 billion), Miami down 37% ($5.1 billion), Austin down 17% ($4.9 billion) and Houston down 47% ($4.5 billion).

In sum, the top 10 metropolitan areas accounted for 41% of all U.S. commercial and multifamily construction starts in 2020, down from a 43% share in 2019.

The second largest metro group included: Atlanta GA down 41% ($4.3 billion), Philadelphia PA down 16% ($4.0 billion), Seattle WA down 31% ($3.9 billion), Nashville TN down 3% ($3.9 billion), Denver CO up 17% ($3.3 billion), Orlando FL down 17% ($3.1 billion), Kansas City MO up 20% ($2.5 billion), San Francisco CA down 46% ($2.4 billion), Tampa FL down 19% ($2.4 billion), and Minneapolis MN down 42% ($2.4 billion).

“The pandemic is having a significant negative impact on commercial and multifamily construction across the country,” stated Richard Branch, Chief Economist for Dodge Data & Analytics. “While some areas stabilized over the summer, the current wave of the virus has further hindered activity. The recently passed $900 billion stimulus plan will go a long way towards re-energizing the economy.” Branch continued,

“The construction sector will show signs of recovery in 2021, but, the road back to full recovery will be long and difficult. The effects of the pandemic on the U.S. economy and building markets will be felt for several years.”

About Dodge Data & Analytics: Dodge Data & Analytics is North America’s leading provider of commercial construction project data, market forecasting & analytics services and workflow integration solutions for the construction industry. To learn more go to: www.construction.com.

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