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Building Contracts Down More Than 50 Percent From October 2014

A slowdown in Houston-area chemical plant construction accounts for most of the decline.

Building contracts totaled $14.1 billion for the first ten months of the year, according to Dodge Data & Analytics. That’s down from $29.7 billion worth awarded between January and October of last year. The drop comes chiefly from a slowdown in new chemical plant construction, which hit an all-time high in 2014.

Patrick Jankowski is senior vice president of research at the Greater Houston Partnership. He says that while contracts are down, building activity is still on the rise.

“The peak in chemical plant construction actually won’t occur into 2016 and maybe run a little bit into 2017, so that’s still going to be buoying the construction industry for a while,” he says.

Contracts for residential construction rose 1.4 percent over the same period.

“The problem is that a number of traditional lenders have actually redlined Houston,” Jankowski says. “They’re sitting back and waiting to see what’s going to be happening with the economy. So they’re not lending to the companies that develop the lots.”

That means the supply of single-family homes will remain tight for at least another year.

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Andrew Schneider

Andrew Schneider

Politics and Government Reporter

Andrew heads Houston Public Media’s coverage of national, state, and local elections. He also reports on major policy issues before the Texas Legislature and county and city governments across Greater Houston. Before taking up his current post, Andrew spent five years as Houston Public Media’s business reporter, covering the oil...

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