Non-Residential Construction Dollars Lowest Since 2003

We reported last week how Kansas City residential construction rose but its commercial building was still low.

That trend seems to be the norm for other parts in the nation as well with dollars spent on commercial construction at the lowest they've been since 2003.

So what's the deal?

The deal is investor confidence. Until the economy shows signs of healthy and steady improvement, venture capitalists and commercial lenders are going to keep a tight grasp on the purse strings. Ken Simonson, Associated General Contractor's spokesman thinks the decline indicates a weakness in the commercial real estate sector. What was your first clue, Ken?

Despite the numbers and the naysayers, the only way to boost commercial construction is to prompt the investors to start investing again. Eventually demand catches up with supply. In the areas where unemployment rates are dropping, more workers mean more consumer consumption and the trickle-up effect will soon be felt by the banks who will happily start footing the costs, once again.

Bank on it.