BLD Pulse
- June inputs to construction industries rose 0.60% m/m; construction materials rose 0.11% and cement was flat. The national tape is still rising, but package-level buy-out remains the decision variable. BLS PPI WPU132
- June steel mill products rose 5.46% m/m while lumber fell 0.36% and cement was unchanged. Revalidate steel-intensive electrical, structural and envelope scopes separately from wood and concrete. BLS PPI WPU101704
- EIA's Aug. 3 bulletin put national on-highway diesel at $5.348/gal, up $0.035 week over week and $1.548 from a year earlier; horizontal work and logistics still carry fuel sensitivity. EIA Weekly Petroleum Status Report
- Trading Economics showed Aug. 10 copper at $6.5828/lb (+0.19%) and aluminum at $3,319.60/t (+1.32%); directional spot only, but both matter to electrical and mechanical packages. Trading Economics Commodities
- Census June permits were 1.367M SAAR, total starts 1.427M and single-family starts 895K; permits fell 3.0% m/m while starts rose 19.0% from revised May. U.S. Census New Residential Construction
- June ABI was 47.3, with inquiries at 56.1 and design contracts at 49.8; billings remained below 50 and average backlog slipped to 6.3 months in Q2. AIA/Deltek ABI June 2026
- AIA's July forecast is K-shaped: 2026 data-center spending +33% versus office -5.1%, manufacturing -11.6%, warehouses -1.7% and total nonresidential -0.3%. AIA July 2026 Consensus Forecast
- Featured Salt Lake City industrial vacancy was 7.2% in Q2, with 2.8M SF of six-month absorption and asking rent $0.04 above year-ago levels; the under-construction pipeline is nearly 73% below Q2 2021. CBRE Salt Lake City Industrial Q2 2026
Executive snapshot
- Deteriorating Electrical & switchgear lead today's cost narrative: Reuters reports generator step-up transformers above 160 weeks and high-voltage breakers at 125 weeks; transformers may rise 4% to 10% over the next year. Treat factory slots, FAT and energization as critical-path procurement. Reuters Grid Equipment
- Cautious Broad construction inputs are still elevated: BLS shows June stage-4 construction inputs +7.2% y/y, goods inputs +7.4% y/y and final-demand construction +3.5% y/y, even as energy inputs fell 12.1% m/m. BLS PPI Detailed Report June 2026
- Cautious Metals remain a live MEP variable: Aug. 10 directional quotes were copper $6.5828/lb (+0.19%) and aluminum $3,319.60/t (+1.32%). Lock origin, quote validity, copper basis and approved alternates before design freeze. Trading Economics Commodities
- Neutral Housing is mixed: permits declined 3.0% m/m to 1.367M SAAR while total starts jumped 19.0% m/m to 1.427M; single-family starts were 895K, essentially flat versus May. U.S. Census New Residential Construction
- Cautious Design demand is not broad-based: ABI improved to 47.3 but stayed negative; commercial/industrial was 46.7, multifamily 45.6 and design contracts 49.8. Convert inquiries into signed work before staffing to a recovery. AIA/Deltek ABI June 2026
- Positive Data centers remain the top demand arm: AIA forecasts +33% spending in 2026, while JLL says primary-market grid-connection waits exceed four years. Power availability, not land alone, sets feasible delivery dates. JLL 2026 Global Data Center Outlook
- Positive Salt Lake City is improving, not risk-free: CBRE shows 7.2% vacancy and 2.8M SF six-month absorption, but the pipeline is nearly 73% below Q2 2021. Favor efficient, well-located product and verify submarket tenant evidence. CBRE Salt Lake City Industrial Q2 2026
Market movers
| Item | Change | Note |
|---|---|---|
| Steel mill products PPI | +5.46% m/m in June ▲ | Reprice steel-heavy structural, electrical, switchgear and envelope scopes; the month-to-month move is large enough to invalidate stale allowances. BLS PPI WPU101704 |
| Copper / aluminum spot | Copper $6.5828/lb; aluminum $3,319.60/t on Aug. 10 ▲ | Directional spot only. Confirm supplier basis, origin, quote validity and escalation language before releasing electrical or HVAC packages. Trading Economics Commodities |
| Diesel fuel | $5.348/gal; +$0.035 w/w and +$1.548 y/y ▲ | Carry fuel sensitivity through excavation, haul, cranes and logistics; avoid treating a single national average as a local equipment-rate forecast. EIA Weekly Petroleum Status Report |
| Housing permits / starts | 1.367M / 1.427M SAAR ▲ | Permits softened while starts rebounded; separate forward authorization from current activity when sizing residential subcontractor demand. U.S. Census New Residential Construction |
| Data-center electrical lead times | GSU transformers >160 weeks; HV breakers 125 weeks ▲ | Reserve factory capacity, approve basis-of-design and map FAT, shipping, site receipt and energization to the critical path. Reuters Grid Equipment |
| Salt Lake City industrial vacancy | 7.2%; second consecutive quarterly decline ▼ | Six-month absorption reached 2.8M SF and rents were $0.04 above year ago, but the market still needs a submarket and delivery-curve screen. CBRE Salt Lake City Industrial Q2 2026 |
Sector outlooks
| Sector | Outlook | Signal |
|---|---|---|
| Data centers | Positive | Demand is strong; power and electrical equipment are the gating variables JLL 2026 Global Data Center Outlook |
| Industrial / logistics | Positive | Leasing re-accelerated nationally and Salt Lake City absorption improved, but delivery timing still matters JLL U.S. Industrial Market Dynamics Q2 2026 |
| Public / infrastructure | Neutral | Power-load growth is pulling transmission, generation and interconnection work forward, but approvals and equipment slots control conversion EIA Data Center Server Energy Use |
| Multifamily | Neutral | Absorption outpaced completions for a second consecutive quarter across all 69 CBRE markets, but rent growth remains modest CBRE U.S. Multifamily Q2 2026 |
| Single-family | Neutral | Starts rebounded while permits softened; affordability and conversion from authorization remain the forward constraints U.S. Census New Residential Construction |
| Office / commercial | Cautious | The aggregate commercial forecast is positive only because data centers offset weakness in office, warehouses and manufacturing AIA July 2026 Consensus Forecast |
Strategic watchlist
- Electrical procurement: reserve transformer and switchgear production slots before the shell schedule hardens; record FAT, shipping, energization and substitution triggers. Reuters Grid Equipment
- Tariff classification: Section 232 rates vary by metal content, derivatives, U.S. content and origin; AGC lists 50% metals, 25% derivatives, 15% industrial/electrical grid equipment and 10% softwood lumber. Canada-specific 50% tariffs on listed goods start Aug. 19. AGC Tariff Resource Center
- Salt Lake City market selection: pair 7.2% vacancy and 2.8M SF six-month absorption with tenant evidence, labor draw, utility capacity and a lower pipeline than 2021 before raising basis. CBRE Salt Lake City Industrial Q2 2026
- Design-to-start conversion: ABI inquiries improved to 56.1, but design contracts were 49.8 and billings remained below 50; track signed work and backlog by sector before adding fixed overhead. AIA/Deltek ABI June 2026
Top questions leaders should be asking
- Which transformer, switchgear and breaker packages need a factory slot now, and what is the contingency if the utility or OEM slips?
- Which electrical and mechanical scopes have copper, aluminum, origin or Section 232 assumptions that are not visible in the estimate?
- For Salt Lake City, is the target submarket supported by tenant evidence and delivery timing, or are we capitalizing a metro-level recovery too early?
- Are ABI inquiries converting into signed work in our target sectors, and are we separating data-center demand from ordinary office and manufacturing weakness?
- How much of current housing starts is a one-month rebound versus a durable improvement in permits, affordability and subcontractor backlog?
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