More Construction Projects Are Being Delayed Or Abandoned Entirely
The number of U.S. construction projects that are being abandoned, paused or seeing a delayed bid date was up 1.7% over the last month for the week ended March 2, according to ConstructConnect.
Fourteen percent more public projects, which includes infrastructure work, are on hold compared to the same week in 2023, ConstructConnect reports. On the private side, 9% more projects are on hold.
Perhaps most alarmingly, the number of abandoned public projects jumped 70% compared to the same week in 2023.
The company's Project Stress Index closed the week at 131.1. The index tracks the pace at which U.S. commercial construction projects have experienced a bid date delay, have been placed on hold temporarily or have been abandoned altogether. Currently, 100 is equal to the average of the index's weekly values in 2021.
Projects can be delayed by several factors, including materials shipment timelines, labor issues, financing concerns or weather. Many of these factors have converged in recent months, with elevated interest rates meeting shipping logjams and winter storms.
Overall depression in the commercial real estate sector is a major culprit for delayed projects, ConstructConnect Senior Economist Michael Guckes told Construction Dive.