January 12, 2009
Builders can expect slowdowns in 2009
U.S. builders and architects can expect a sharp decline in business in 2009, consulting firm McGraw-Hill said recently.
Robert Murray, McGraw-Hill's vice president for economic affairs, said commercial building projects could shrink 24 percent this year, repeating the decline suffered in 2008, USA Today reported Monday.Retail construction fell 33 percent in 2008 and could shrink by 29 percent this year, Murray said.
McGraw-Hill also predicted office space construction to decline sharply, pulling back 26 percent, while hotel construction could face a 30 percent contraction after shrinking a relatively small 3 percent in 2008.
Noting hotels had pulled back on projects, Goldman Sachs upgraded hotel stocks last week, the newspaper said.
Some architects are reporting they have enough business to see them through the next quarter or more, but others are reducing staff.
People have lost confidence, said Tom Howorth, a principal at Howorth & Associates Architects in Oxford, Miss.
The lost confidence applies to universities, non-profit groups, such as churches, and
individuals who are saying, 'Look at what's happened to real estate values,' he said.
Developers "¦ aren't even thinking about spending money in this economy.