Dodge: Twin Cities construction starts up 23% in 2018.

Byline: Brian Johnson

Commercial and residential builders in the Twin Cities ended 2018 on a slow note, but that wasn't enough to spoil a strong year of building activity as the Twin Cities outperformed the nation as a whole.

The Twin Cities saw $8.325 billion worth of construction starts overall in 2018, up 23 percent from the previous year, according to a new report from New York-based Dodge Data & Analytics. That includes $3.95 billion in nonresidential starts, up 42 percent, and $4.37 billion in residential, a 10 percent jump.

In December, Twin Cities nonresidential construction starts ($166.42 million) were even with the previous December, and residential activity ($318.17 million) was off 10 percent, according to Dodge.

Overall, the U.S. saw $789 billion worth of construction starts in 2018, up 0.3 percent from 2017, according to Dodge's Jan. 24 report. A 31 percent nosedive in starts for electric utility and gas plant projects brought the overall numbers down, according to Dodge.

Residential starts include single-family and multifamily housing, and nonresidential covers everything from offices and retail to hotels and government buildings, according to Dodge.

Robert Murray, chief economist for Dodge Data & Analytics, said in an email to Finance & Commerce that nonresidential construction starts in the Twin Cities regained their "upward trend" after a 17 percent drop in 2017.

A "twelvefold increase" in manufacturing buildings fueled the 42 percent surge, Murray noted. That stems from the start of a $750 million construction program at the Flint Hills Refinery in Rosemount, and Andersen Corp.'s $40 million warehouse project in Bayport.

Other big nonresidential projects reflected in the year-end report include the $150 million renovation of the downtown Minneapolis Dayton's store and the future city of Minneapolis office building in downtown Minneapolis ($108 million).

"The increases for nonresidential building were fairly widespread," Murray said.

On the homebuilding side, five projects valued at $50 million or more gave rise to a 27 percent increase in multifamily starts, Murray said. That comes after a 13 percent decline the previous year.

Top projects include the $110 million, 295-unit Canterbury Commons apartment complex in Shakopee and the $105 million Pioneer Hall renovation on the University of Minnesota's Twin Cities campus.

Also in the Twin Cities, single-family housing starts nudged up 2 percent in 2018 after a...