Iron-Rich, Cash-Poor U.S. Contractors Offload Assets As Domestic Markets Tumble 08/13/2008
Construction markets are sinking, forcing some contractors that built today’s foreclosed housing tracts to make payroll by selling their iron. But heavy global demand is a bright spot in the U.S. equipment glut.
One builder in Southern California is cashing in on its fleet of “green” machines by renting them out. “We’ve got a lot of equipment, and a lot of it is parked right now,” says Michael Bobeczko, who leads Santa Ana, Calif.-based Sukut Construction Inc.’s marketing department. The contractor, which runs 120 scrapers and other giant earthmovers appraised for hundreds of thousands of dollars per unit, started offering equipment rentals last month in response to the tightening California economy. It also is attracting buyers from overseas, such as in the Middle East, where it originally procured some of its vintage machinery used in the homebuilding boom.