ST. LOUIS — The St. Louis metropolitan area reported more construction starts in May, foreshadowing a potential warming in market confidence, according to new research from Dodge Data & Analytics.
The month of May saw $216.8 million worth of new commercial projects start construction — a 259% spike compared to April. Residential projects, including multifamily, grew 8.9% to $170.8 million during the same time period. Overall, construction in the St. Louis region grew 78.4% since April, a value of $387.7 million in projects, the data shows.
April was the first full month to be impacted by the coronavirus, with fewer new construction projects starting despite local authorities allowing construction sites to remain open. Government officials in other parts of the country closed construction sites as COVID-19 spread.
The month-to-month increase suggests lenders might have been more willing to close loans on new projects as stay-at-home orders eased and the Covid-19 curve appeared to flatten, said David Messner, whose New Legacy Development Partners is redeveloping Laclede's Landing and the Mississippi riverfront.
"I would be cautiously optimistic as we have seen a lot of lenders tighten back up in the last 20 days," Messner said. "The key months will really be September and October when most of the stimulus and congressional programs will run out, unless they do another round or extension of those benefits."
Year to date, total construction starts are up 68% over 2019, with more than $2.1 billion worth of residential and nonresidential projects having started this year compared to $1.3 billion at this point last year. There's also 151% more nonresidential projects — like office, retail, hotels, warehouses, manufacturing, educational, health care, religious, government, recreational and other buildings — in 2020 compared to 2019, according to the data.
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