Construction Financials A Mixed Bag

• Ashley Slovinski
• August 10, 2010

Reuters recently reported that the commercial real estate market may have avoided the crash that was expected of it. Because banks have been able to extend, restructure and modify loans, the commercial market has been given a chance to breathe and values have slightly risen. 

In addition, commercial property values rose for the first time in two months during the month of April, according to the Moody's/REAL All Property Type Aggregate Index.  Reed Construction Data also reported an increase in building permits in April, particularly in the non-residential sector.

Despite this positive news, construction employment decreased by 11,000 between June and July 2010 while the industry's unemployment rate fell to 17.3 percent, according to a new analysis by the AGC of America of federal employment data. The third month of construction employment declines, despite the stimulus, reflects overall weak demand for private, local and state funded construction, association officials noted.