BLD Pulse
- On-highway diesel averaged $5.21/gal (EIA, week of June 9); pump prices remain a direct hit to hauling, earthwork, and logistics-heavy scopes. EIA Gasoline & Diesel Update
- Steel PPI (hot-rolled bars/plates/shapes, WPU101704) eased to 292.769 in May (−0.8% m/m), but the ENR Materials Index is still +5.3% y/y on tariff pass-through. BLS PPI — WPU101704
- Lumber & wood products PPI (WPU081) edged up to 280.994 in May (+0.3% m/m) — the featured trade angle today is the roofing/envelope package, not framing. BLS PPI — WPU081
- Cement PPI (WPU1331) printed 409.454 in May (+0.1% m/m); inputs to construction (WPU132) rose to 474.921 (+0.25% m/m) — broad input creep persists. BLS PPI — WPU1331 / WPU132
- Construction materials PPI (WPU1322) essentially flat in May at 357.775 (−0.03% m/m) — headline materials inflation has cooled even as fabricated/electrical items stay hot. BLS PPI — WPU1322
- Housing: April starts 1,465,000 SAAR and single-family 872,000; permits 1,442,000 SAAR keep a forward pipeline for summer activity. Census New Residential Construction
- ABI slipped to 48.3 in April (Mar: 49.8) — below the 50 expansion line; multifamily 51.5 and institutional 51.1 lead, commercial/industrial 48.9 lags. AIA/Deltek ABI April 2026
- Section 232 metals (eff. June 8, 2026): 50% on steel/aluminum/copper, 25% on derivative goods, 15% on transformers/switchgear/industrial machinery — a direct driver of long-lead electrical equipment cost. White House Proclamation (June 2, 2026)
Executive snapshot
- Positive Metro spotlight — Columbus, OH: One of the country’s strongest industrial markets, with vacancy around 5.0–6.6%, asking rents near $6.71/SF, and a blockbuster 3.3M SF of Q1 2026 net absorption. New-supply starts are expected to drop ~55% in 2026, setting up rent-growth acceleration. Terry Coyne / Cresco 1Q26 Columbus Industrial
- Neutral Columbus power story: AEP Ohio and SB Energy are planning a $4.2B transmission build for a 10 GW data-center campus at the former Portsmouth/Piketon site, with power targeted for 2029 under a dedicated data-center rate class — large-load entitlement and power timing now gate site selection. TechStock² / AEP Ohio (June 2026)
- Cautious Trade deep-dive — Roofing & Envelope: Single-ply membrane is running TPO $5.50–$9.50/SF and EPDM $4–$12/SF installed; polyiso insulation $0.75–$1.00/board-ft; standing-seam metal $8–$18/SF (steel/aluminum). Metal-panel inputs ride the Section 232 metals tariff, so big-box and DC enclosures carry envelope-cost risk. WeatherShield / Brandon J Roofing 2026 cost data
- Positive Industrial / logistics turning: National vacancy held at 7.0% in Q1 2026 (10 bps below the peak), net absorption hit 40M SF (+52% y/y), and the under-construction pipeline rose to 284M SF — Cushman calls peak vacancy “in the rearview mirror.” Cushman & Wakefield Q1 2026 U.S. Industrial
- Cautious Data-center long-lead deepening: large custom transformer lead times now stretch to 36 months (substation units cited as high as ~160 weeks), and AI/liquid-cooled facility cost has rebased to $13.1–$13.4M/MW vs ~$10.8M/MW air-cooled — procurement, not land, is the binding constraint. Datacentres.com / iRecruit (May–June 2026)
- Cautious Cost escalation read: Skanska’s Spring 2026 report shows its Composite Cost Index +6% y/y and double-digit MEP-trade escalation on data-center/life-science demand; nonresidential construction added 19,000 jobs in April — high-tech work keeps pricing skilled trades. Skanska Spring 2026 Market Trends
- Neutral Starts mix: Dodge reports total construction starts +5.4% YTD through April, led by data centers and energy generation; multifamily starts +23% y/y while single-family starts slid — demand is concentrating in big-tech and rental product. AGC Data DIGest / Dodge (May 2026)
Market movers
| Item | Change | Note |
|---|---|---|
| On-highway diesel | $5.21/gal ▲ | EIA week of June 9; elevated vs gasoline ($4.15) — a direct cost to hauling and earthwork scopes. EIA Gasoline & Diesel Update |
| Steel PPI (WPU101704) | −0.8% m/m ▼ | May 292.769 vs 295.074 in April — spot eased, but ENR Materials Index still +5.3% y/y on tariffs. BLS PPI — WPU101704 |
| Inputs to construction PPI (WPU132) | +0.25% m/m ▲ | May 474.921 vs 473.722 in April; broad input cost creep continues despite flat headline materials. BLS PPI — WPU132 |
| Cement PPI (WPU1331) | +0.1% m/m ▲ | May 409.454 vs 409.059 in April — delivered concrete remains a bid-day risk. BLS PPI — WPU1331 |
| Industrial net absorption (Q1) | +52% y/y ▲ | 40M SF in Q1 2026 — strongest first quarter since 2023; vacancy 7.0%, 10 bps below peak. Cushman & Wakefield Q1 2026 |
| Columbus industrial absorption (Q1) | +3.3M SF ▲ | 1Q26 net absorption with vacancy ~5.0–6.6% and rents ~$6.71/SF; 2026 starts projected down ~55%. Terry Coyne 1Q26 Columbus |
Sector outlooks
| Sector | Outlook | Signal |
|---|---|---|
| Data centers | Cautious | Transformer lead times ~36 months; AI/liquid-cooled cost rebased to $13.1–$13.4M/MW; Ohio (AEP/Piketon 10 GW) and Columbus emerging as core large-load markets Datacentres.com / AEP Ohio |
| Industrial / logistics | Positive | Vacancy 7.0% (10 bps below peak); absorption 40M SF (+52% y/y); pipeline 284M SF; Cushman sees peak vacancy passed Cushman & Wakefield Q1 2026 |
| Multifamily | Positive | Multifamily starts +23% y/y and +14% m/m (April); ABI multifamily sub-index 51.5 — the rental-product cycle is re-accelerating AGC Data DIGest / Dodge |
| Single-family | Neutral | April single-family starts 872K SAAR, down 9% m/m; permits 1.442M imply forward demand but rate sensitivity stays high Census New Residential Construction |
| Public / infrastructure | Positive | Nonbuilding starts +12.3% YTD with ~79% growth in electric power/utilities (Dodge); grid and transmission spend is the standout public pipeline AGC Data DIGest / Dodge |
| Commercial / office | Deteriorating | ABI commercial/industrial at 48.9 and still contracting — the weakest specialization for six months; institutional showing tentative recovery AIA/Deltek ABI April 2026 |
Strategic watchlist
- Columbus large-load timing: before underwriting Columbus/Central Ohio industrial or data-center land, confirm AEP Ohio interconnect position and the new data-center rate class — power timing (the Piketon 10 GW campus is targeted at 2029) now governs site selection more than lease comps. TechStock² / AEP Ohio
- Envelope cost on metal-heavy enclosures: with standing-seam metal at $8–$18/SF and Section 232 lifting metal-panel inputs, re-price big-box and DC roofing/envelope packages; favor single-ply (TPO/EPDM) where spec allows to blunt tariff exposure. WeatherShield 2026 roofing cost
- Section 232 pass-through audit: the June 8 metals tariffs (50% / 25% derivative / 15% equipment) are live through 2027 — review open POs and GMP language on transformers, switchgear, HVAC, and metal panels before July invoicing. White House Proclamation (June 2026)
- Transformer critical path: with custom high-voltage transformers at ~36-month lead times, any data-center or large-commercial project should place equipment orders during initial site planning — before permits and final design — or accept a power-delivery critical path. iRecruit / Datacentres.com
Top questions leaders should be asking
- For any project with transformers, switchgear, HVAC, or metal panels sourced abroad, have you mapped HTS exposure to the June 8 Section 232 rates (50% / 25% / 15%) and updated GMP pass-through language?
- On big-box or data-center enclosures, are you pricing the roofing/envelope package to current single-ply and metal-panel costs — and does the spec let you substitute TPO/EPDM to limit tariff exposure?
- In Columbus and other emerging large-load metros, have you confirmed utility interconnect position and the data-center rate class before committing to land?
- With transformer lead times near 36 months, which pipeline projects need long-lead equipment ordered now — ahead of permits — to protect the power-delivery critical path?
- Given multifamily starts +23% y/y while single-family slid, is your bidding capacity aligned to where demand is actually concentrating (rental product, data centers, utilities)?
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