The boom in data center construction was the reason nonresidential construction spending managed to increase 0.1% in July, according to an Associated Builders and Contractors analysis of the latest data published by the U.S. Census Bureau.
On a seasonally adjusted annualized basis, nonresidential spending totaled $1.286 trillion. Spending was down on a monthly basis in 8 of 16 nonresidential subcategories, including manufacturing (-1.0%); transportation (-0.5%) and healthcare (-0.5%), the ABC said.
“The increase in nonresidential construction spending that occurred in July was entirely due to data centers,” said ABC Chief Economist Anirban Basu. “Excluding that booming category, nonresidential spending fell for the second straight month and is down to the lowest level since September 2023.
“Nonresidential activity is even more concentrated given that the power category, which has been boosted by the electricity needs of data centers, has also grown substantially over the past year,” Basu said. “While contractors remain upbeat about their sales over the next six months, according to ABC’s Construction Confidence Index, that upbeat outlook is increasingly dependent on a single sector.”
The Census Bureau includes data centers as a subcategory of “office” construction, which was up 2.9% overall in July. In 2024, the bureau began publishing data-center construction separately as a subset of its private office construction data.
An analysis of that subset data by Piedmont Crescent Capital shows that data center construction ran $37.2 billion in the first seven months of the year, 34.8% above the same period in 2025, while every other kind of office building fell 9.5%. Data centers were 57% of private office construction, against 47% a year earlier.
On the residential side, the Census Bureau said private residential construction fell 1.3% to $859.0 billion and is down 4.1% in the first seven months of the year. New single-family construction fell 3.2% in July, the largest monthly decline of any private category in the report.
