Construction Starts Surge 21% as Megaprojects Drive October Growth

Dodge Reports Strongest Monthly Growth, Fueled by Data Centers and Manufacturing

Construction starts jumped 21.1% in October 2025 to a seasonally adjusted annual rate of $1.53 trillion, according to Dodge Construction Network data released on November 21, 2025. The surge marks significant momentum in the construction industry, driven predominantly by major megaproject groundbreakings valued at $1 billion or higher.

According to Construction Dive analysis of the Dodge data, 10 projects valued at $1 billion or more broke ground in October, far exceeding typical monthly volumes. This concentration of high-value project activity propelled the overall market forward, though growth remains uneven across different construction sectors and project sizes.

Megaprojects Leading the Charge

The October groundbreakings included some of the largest infrastructure and industrial projects in recent history. The mega-deals include:

• Calcasieu Pass LNG Export Terminal and Pipeline (Cameron, Louisiana): $15.1 billion – The largest project to break ground in October, this energy infrastructure facility represents major capital commitment to natural gas export infrastructure.
• Rio Grande LNG (Phase 2, Trains 4 & 5) in Brownsville, Texas: $9 billion – A continuation of existing LNG expansion, demonstrating sustained demand for liquefied natural gas export capacity.
• Meta Hyperion Data Center in Richland, Louisiana: $7.5 billion – A massive technology facility reflecting surging demand for computing and storage infrastructure driven by AI and data processing needs.
• Frederick Douglass Tunnel Improvement in Maryland: $5.9 billion – Critical transit and rail infrastructure supporting the Northeast Corridor.
• LA Convention Center Expansion in Los Angeles: $1.9 billion – Major hospitality and convention infrastructure.
• Eli Lilly Manufacturing Facility in Lebanon, Indiana: $1.7 billion – Pharmaceutical manufacturing representing industrial diversification in the Midwest.

Nonresidential Construction Strength

Nonresidential construction starts (commercial and institutional projects) jumped 17.9% in October, driven by exceptional growth in specific categories:

• Office and Data Centers: +45.5% – Data center construction continues its extraordinary expansion, reflecting massive technology infrastructure investment and AI computing demands.
• Manufacturing: +107.2% – A dramatic 107% increase reflects heightened industrial investment in domestic production capacity, partially driven by reshoring initiatives and supply chain restructuring.
• Retail: +15.1% – Modest but solid retail growth despite long-term sector headwinds.
• Hotels and Warehouses: Posted declines, indicating mixed demand in hospitality and logistics sectors.

Year-to-Date Performance and 12-Month Trends

Looking at performance across longer timeframes reveals a more nuanced picture:

• Year-to-Date (January-October 2025): Nonresidential starts increased 5.6%, a solid pace reflecting sustained but not explosive growth.
• Commercial (YTD 2025): +13.6% year-to-date, indicating strong client demand across retail, office, and hospitality.
• Institutional (YTD 2025): -2.2% year-to-date, reflecting softer demand in education and healthcare facilities.
• 12-Month Ending October 2025 (Nov 2024-Oct 2025): Total nonresidential starts improved 7.5%, commercial +26.9%, institutional +0.2%, and manufacturing declined 16.3% despite October's surge.

Caution: Megaproject Dependency

Sarah Martin, Associate Director of Forecasting at Dodge, offered important context: "Growth in construction starts continued to be propped up by high-value megaproject activity last month. Outside of these high-tech buildings, however, growth appears more moderate."

This observation highlights a critical concern: the construction market's strength depends heavily on a small number of massive projects. The typical small-to-midsize commercial, office, or retail project—the backbone of many regional construction markets—is experiencing more modest growth.

For contractors focused on mid-market work, the October surge may not reflect opportunities in their local markets or project categories. Regional variation, specialty focus, and market segment matter significantly.

Residential Construction Weakness

In contrast to nonresidential strength, residential construction posted declines. Residential starts decreased 15.4% in October, with:

• Multifamily (apartments, condos): -38.5% – A sharp decline indicating weak demand for apartment construction.
• Single-family: +2.2% – Slight growth, but insufficient to offset multifamily weakness.

For the 12 months ending October 2025, residential starts fell 3.1%, indicating sustained softness in the housing construction sector despite robust single-family demand in many regions.

Infrastructure and Nonbuilding Projects

Nonbuilding starts (highways, bridges, utilities, and other infrastructure) rebounded 59.4% in October, driven largely by:

• Utility Construction: +384.5% – Extraordinary surge in electrical grid, water, and telecommunications infrastructure, reflecting massive federal and state investment in infrastructure and energy transition.
• Highway and Bridge Work: -23.7% – Surprising decline despite federal infrastructure funding, possibly reflecting project pipeline timing or permitting delays.

Over the 12-month period ending October 2025, nonbuilding starts jumped 22.9%, reflecting sustained infrastructure investment momentum.

What This Means for Construction Professionals

For general contractors and specialty contractors: The megaproject surge creates opportunity for contractors with large-scale project experience, but also underscores the importance of diversification. Heavy dependence on one or two massive projects creates vulnerability if those projects experience delays or cost overruns.

For suppliers: October's growth suggests strong material demand, particularly in structural steel, concrete, electrical components, and specialty equipment. Maintaining capacity and reliable supply chains is critical.

For workforce: The 21% growth in starts will drive demand for skilled trades. Regions with megaprojects will see competitive labor markets. Firms investing in apprenticeship programs and workforce development will have competitive advantages.

For project finance: Megaprojects require sophisticated financing structures. Construction finance professionals should anticipate strong deal flow and competition for capital.

The Broader Market Context

The October data reflects a construction industry driven primarily by technology infrastructure investment (data centers), energy infrastructure (LNG exports), and manufacturing capacity expansion. This mix differs significantly from traditional construction driven by commercial office, retail, and residential markets.

The shift reflects structural changes in the economy: increased demand for digital infrastructure, reshoring of manufacturing, and energy transition investments. Construction firms succeeding in 2025 and beyond are those positioned to serve these emerging priority sectors.

Sources: Dodge Construction Network (published November 21, 2025), Construction Dive analysis, Bureau of Labor Statistics