Electric power and utilities projects drove construction starts in January, while other sectors saw declines, according to the Dodge Construction Network, Boston.

Total construction starts expanded 0.7% in January from the prior month to a seasonally adjusted annual rate of $1.24 trillion, per Dodge Construction Network data. The expansion was due to nonbuilding construction starts, which grew 24.3% in January to a seasonally adjusted annual rate of $522 billion. That offset month-over-month declines in other sectors: nonresidential building starts fell by 15.4% and residential starts decreased 6.4%.

The nonbuilding category was held up solely by electric power/utilities, which soared by 184.8% due to three megaprojects totaling nearly $20 billion:

• The $12 billion Port Arthur LNG¾Liquefaction Phase 2 (Trains 3 and 4) in Port Arthur, Texas
• The $6 billion Homer City Energy Campus 4.4 gigawatts in Homer City, Pa.
• The $1.5 billion Tehuacana Creek 1 Solar and Battery Storage project in Navarro, Texas

“The LNG plant is phase 2, so that was long in the pipeline. The other two have probably been in planning for a good two years,” said Eric Gaus, chief economist at Dodge Construction Network.

While the outsized megaprojects drove the overall monthly increase, other sectors in the nonbuilding category faced month-over-month declines¾highways and bridges (-42.3%), miscellaneous nonbuilding (-31.5%) and environmental public works (-5.9%).  

Residential building starts fell by 6.4% in January from the prior month to a seasonally adjusted annual rate of $345 billion. Single-family starts increased 1.5%, while multifamily starts fell by 17.8%.

The largest multifamily structures to break ground in January were the $335 million 38 Gramercy Park East Condominiums in New York City, the $265 million Lakeview Residence in West Palm Beach, Fla., and the $200 million Homestead Gateway Mixed Residential Tower in Jersey City, N.J.  

Comparing the past 12 months ending January 2026 to the previous 12 months ending January 2025, multifamily was up 13%, while single-family was down 15%. As such, the overall residential category fell largely due to the depressed single-family construction, though multifamily will also likely cool off this year as well, according to Gaus.

“This is largely because where you can build fast, like in the Sunbelt, we have mostly stabilized vacancy rates,” he said. “The Northeast and West Coast will still be building, but they build out at a slower rate. Also, broadly speaking, slower immigration is changing housing demand.”

Nonresidential building starts decreased 15.4% in January from the prior month to a seasonally adjusted annual rate of $378 billion. Commercial starts were down 27.3%, alongside a drop in offices and data centers (-52.2%), parking garages (-6.7%) and hotels (-17.4%). Meanwhile, warehouses (+10.2% m/m) and retail starts (+6.5%) posted an increase between December and January.

Gaus did not give too much weight to the month-over-month volatility of data center starts.

“The pipeline for data centers is very strong,” he said. “Data centers get turned on almost the minute they are completed.”

Institutional starts declined 15.2% from the prior month, driven by weaker education (-21.9%) and miscellaneous institutional (--26.1%) starts. Slower institutional starts will continue into 2026 due to less federal government support, Gaus said.

The monthly decline in institutional starts was partially offset by 10.5% growth in healthcare facility starts. Manufacturing, meanwhile, pulled up by 97.5% in January due mainly to the start of the $1 billion Amkor Semiconductor Advanced Packaging (Phase 1) in Peoria, Ariz.

Other nonresidential building projects to break ground in January were the $1.2 billion New York Presbyterian Cancer Center in New York City and the $714 million QTS CLT1 Data Center (Phase 1) in York, S.C.

Regionally, total construction starts in January rose in the Northeast from the prior month (+32% m/m), the South Central (+9.6% m/m) and the South Atlantic (+2.2% m/m). Meanwhile, starts slowed down in the West (-21.1% m/m) and the Midwest (-12.6% m/m). 

On a year-over-year basis, total construction starts were up 5% from January 2025. Nonresidential starts were down 10.3%, residential starts were down 17% and nonbuilding starts were up by 46.1% over the same period.

For the 12 months ending January 2026, total construction starts were up 6.1% from the 12 months ending January 2025. Residential starts were down 6%, nonresidential starts were up 5.5% and nonbuilding was up 21%.