NEW YORK CITY—The construction pipeline is filling up, withMcGraw-Hill Construction's Dodge Momentum Indexfor nonresidential projects in the planning stages showing itsthird consecutive monthly increase. And in the latest of a stringof positive reports from the Associated General Contractorsof America, the Arlington, VA-based trade association saidits analysis of the latest Census Bureau figures showed overallspending was up for the third month in a row.

However, one reason for the increase in spending may be a risein costs. Consulting firm Rider Levett Bucknallsays US construction costs rose 1.15% in the first quarter of 2014,the largest three-month increase since 2008.

Rider Levett Bucknall's research shows that overall constructioncosts have been relatively flat for the past six years and are nowbeginning to show signs of spiking. These increases result from avariety of factors including increased construction activity,easing of general contractor price compression and the availabilityof labor and sub-trades.

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Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.