Corporate Office Construction Spending Rose 5.7% YOY in February

San Francisco, CA, April 15, 2024-“New office starts have also downshifted considerably in the wake of hybrid work, but total spending on office projects fell only slightly in February and was up 5.7% annually," according to Wells Fargo. "The surprising uptrend is likely explained by the Census’ inclusion of data center construction in the office category. Third-party data sources indicate a surge in data center construction over the past few years alongside booming growth in Artificial Intelligence and other digital services industries. 

“Manufacturing spending fell by 0.6% during the month, although the dip follows a substantial 2.3% gain in outlays during January. The build-out of electric vehicle and semiconductor supply chains continues to fuel rapid growth in total manufacturing project spending, which was up nearly 32% year-over-year in February.

“Other categories of major categories spending mostly weakened in February. On the institutional side, education and health project outlays declined by 1.5% and 2.2%, respectively. Power spending fell 0.4%, while highway & street eased 1.5%. Transportation, which rose 0.7%, was the only major nonresidential segment to post a monthly gain.”