‘Unwelcome surge’ of project abandonments hits construction

Mission stress picked again up in March as rising uncertainty led extra developers to abandon projects, in keeping with the most recent knowledge from Cincinnati-based ConstructConnect.

The Mission Stress Index, a measure of development tasks which were paused, deserted or have a delayed bid date, elevated 1.1% in March. That marks a 13.7% enhance over 2021 ranges, the benchmark yr for the index, in keeping with ConstructConnect.

The uptick in total stress over the previous month occurred regardless of an 8% drop in on-hold exercise and a 0.7% dip in delayed bids. A 9.5% bounce in mission abandonments erased most of that progress, mentioned Michael Guckes, chief economist at ConstructConnect.

“The early weeks and months of 2025 have seen an unwelcome surge in mission abandonment exercise,” Guckes informed Building Dive. “The extent of abandonments in each sectors is presently above, and effectively above within the case of the non-public sector, historic averages.”

That rise echoes patterns seen in early 2024, when fears round high interest rates and valuations led some builders to drag again. Guckes added the business now faces an identical level of uncertainty, notably if enter costs proceed to leap this yr.

“Whereas in the present day’s atmosphere continues to be considered one of excessive rates of interest, different issues associated to the steadiness of the financial system within the coming quarters and even years might as soon as once more be spooking house owners and builders who at the moment are abandoning tasks,” mentioned Guckes. “This can be very true of tasks with modest return on funding expectations.”

Non-public tasks stay the main pressure point, in keeping with the info.

The variety of non-public tasks positioned on maintain greater than doubled over the previous 12 months, up 110% in comparison with March 2024. Though non-public sector abandonments fell barely since final March, by 3.8%, the general degree nonetheless stays effectively above historic averages, mentioned Guckes.

The turmoil that has resulted from President Donald Trump’s tariffs is probably going having an influence on development tasks, mentioned Guckes.

“Though non-public tasks make up solely a small portion of the whole variety of tasks on maintain, we have now positively seen a bump on this determine since early February,” mentioned Guckes. “This doesn’t appear to be unintentional because the timing of it appears to correspond with the volatility to business generated by recent governmental policy and the renewed retreat of outlook surveys together with the important consumer sentiment survey.”

The general public sector, alternatively, confirmed some stabilization. Initiatives placed on maintain dropped 22.2% since final March, whereas abandonments dropped 16.3% in comparison with the identical interval final yr.

Throughout March, there have been almost two non-public sector abandonments for each deserted public mission, in keeping with the report.