CNR Survey Says: Credit Crunch Putting Brake on Construction

Tightening lending standards are taking the steam out of construction in metropolitan St. Louis. That is the indication of an Internet credit survey recently completed by St. Louis Construction News & Real Estate (CNR), the "Voice for the St. Louis Construction Industry" since 1969.
 
Eighty-five percent of those responding to the survey said that credit for development and construction has become less available in recent months. Seventy-six percent of respondents said that tighter credit markets have affected the willingness or ability of firms to expand in the area; and 52 percent said that they know of development or construction projects that have been disrupted by sudden changes in the availability of credit.
 
The survey results illustrate that the forces that brought down the Pyramid Companies and their many development projects downtown are being felt in the broader economy.
 
Survey respondents tied the credit crunch to the recession in the housing industry and 82 percent of them said that the downturn in housing has affected other industries in the area.
 
For nearly a decade, construction was a major engine of economic growth in St. Louis that provided good-paying jobs to roughly 100,000 people. CNR's credit survey indicates that tight credit standards are causing that engine to sputter.
 
The CNR credit survey was an unscientific electronic survey, based on questions recently posed to Midwest construction sources by an economist at the St. Louis Federal Reserve.  CNR sent to contractors, architects, and engineers by email and asked them to visit the magazine's web site and complete the survey. The magazine received 57 unique responses.
 

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