Dodge Momentum Index stumbles in July despite $170 million Pala Casino project

$170 million pala
Work will start in October on a $170 million project at the Pala Casino and Resort

The announcement of the $170 million expansion Pala Casino Spa & Resort in San Diego County was one of the few bright spots in new project announcements in July, where the Dodge Momentum Index declined 3.3% to 135.0 (2000=100) from its revised June reading of 139.6.

The Pala project, scheduled to begin construction in October and be completed in May 2019, was listed as one of the leading commercial projects nation-wide in the Dodge Index.

The construction company selected for the renovation and expansion is Level 10 Construction with headquarters in San Francisco and offices in Sunnyvale and San Diego. The architect is Klai Juba Wald of Las Vegas, NV. The contributing architect is Marks Architects of San Diego.

The Dodge Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The move lower in July was due to a 6.6% decline in the institutional component of the Momentum Index, while the commercial component fell 1.1%.

dodge index

This month continues a recent trend of volatility in the Momentum Index where a string of gains is interrupted by a step backwards in planning intentions. Despite the decline from June to July, the Momentum Index is 6.9% higher than one year ago, which suggests further moderate gains in construction activity throughout the year. The commercial component of the Momentum Index is 8.0% higher than last year, while the Institutional component is 5.3% higher.

In July, nine projects entered planning each with a value of $100 million or more. For the institutional building sector, the leading projects were the $200 million Kaiser Permanente Medical Center in Woodbridge VA and the $200 million phase 2B of the Thompson Education Center in Rocky Hill NY.

In California, The Pala renovation and expansion will include: the addition of a new 349 room hotel tower; the conversion of the existing resort pool into a multi-pool and entertainment resort complex; the construction of an inventory of unique hotel suites that will overlook the Starlight Theater event lawn and the new pool and entertainment complex; expanded gaming and casino bar space; a parking garage expansion; a completely remodeled restaurant promenade; a complete refresh of the entire casino interior; a complete refresh of the entire existing hotel tower.

“Our ability to exponentially expand and refresh Pala Casino Spa & Resort is a true testament to, not only the growth of Pala, but also to the thriving economy and the continued strength of the gaming industry in California,” said Robert Smith, chairman of the Pala Band of Mission Indians. “This is a significant milestone for our tribe and we look forward to continuing to exceed the expectations of our loyal patrons.”

The project will increase Pala’s casino from its current 90,000 sq. ft. to more than 102,000 sq. ft. of gaming space.

“We are very excited to engage in our third major expansion since our introduction to the Southern California gaming and hospitality market more than 16 years ago. As in the past, we expect elements of this expansion and upgrade to be unique to our property and to set new resort standards,” said the resort’s CEO Bill Bembenek. “This significant expansion project will complement our already luxurious resort offerings while providing our patrons with new world-class amenities.”

Pala’s renovation and expansion project will create 400 construction jobs, the company said in its news release.