Coronavirus-related supply chain delays threaten developers and builders

Some builders can’t get materials they need because of global shipping slow down

TRD NATIONAL /
Mar.March 23, 2020 03:30 PM
The Port of Los Angeles (Credit: iStock)

The Port of Los Angeles (Credit: iStock)

The coronavirus pandemic is taking its toll not only on landlords and tenants, but also on developers and the construction firms.

The pandemic has slowed global shipping of building materials — and builders are expecting projects to be delayed as a result, according to the New York Times.

Most construction firms have materials in hand they need for projects in the works and some importers have stockpiled materials, but a prolonged crisis could start to impact projects in the near future.

Imports from China to the Port of Los Angeles were down 23 percent in February year-over-year. Contractors have said that shipments of copper have been delayed from China, which appears to be past the worst of the pandemic. Controllers for LED lights imported from China are expected to take six months to ship instead of the usual two, said one executive at a New York-based construction firm.

Governments are also stopping projects. Boston closed all construction sites on Monday and San Francisco ordered work stopped on all projects besides housing developments.

Stoneworkers like PMI International Stone Importers in New Jersey had to cancel a trip earlier this month to Italy to pick out marble for a project.

“Some projects are going to be stalled because of this, there’s no question about it,” said Kevin Gavaghan, a sales manager with PMI.

Investors seem to already be pulling back from the commercial real estate market. Lenders have become more conservative as well as they weigh the risk of delays and stoppages, raising the concern that developments may be scrapped. [NYT]Dennis Lynch


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