Gold Seek:
With residential building in a state of near-collapse, we tend to think that the construction business in general is depressed. While this largely true, there are evidently some niches within the industry that are doing quite well. This point was driven home yesterday in the Rick’s Picks chat room by a commercial builder and subscriber, John D., who occasionally drops in during trading hours. He bore news that Ainsworth, the largest wood panel supplier in America, was on the ropes because of the depressed housing market. Bondholders have taken over the company’s day-to-day operations at the request of the family that has owned and operated Ainsworth.
John’s firm has been feeling the pressure of recession as well. Profits are down and margins are tight – “just like on Wall Street” - and three large projects in which the company was involved have been put on hold due either to the lack of a tenant or of financing. Even so, he notes, there is construction business to be had if you can provide certain specialized services. Such as? In the case of John’s firm, the services include retrofitting structures so that they can use solar energy. “We are trying to hook up with solar companies to provide engineering and roof structure reinforcement for buildings,” he notes. “It is a wide open market. Costco is going solar on many of its existing buildings, and structure reinforcement is an emerging market.” More.
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