“Grim.” “Dire.” “Hairy.”The words construction industry veterans are using to describe the state of project financing show how far the market has fallen since the 2008 economic crash. But while the lean times aren’t over, the market mood appears to be changing from shell-shocked in trenches to a cautious look outward for opportunity.
“It is pretty dire out there, with up to 15 to 20% of construction loans in default,” says David Pfeffer, an attorney and co-chair of the construction practice group at New York’s Tarter Krinsky & Drogin. “But I have been seeing a little light at the end of the tunnel. We still may be a year or two before the rebound, especially in the residential market.”