| Abstract: | The difficulties the U.S. housing market is facing are now quite well known. The commercial side—which includes offices, stores, hotels, and apartments—hasn't garnered as much attention. Because of commercial projects' long lead times, there's always a lag between current market conditions and construction activity. That's why commercial building remained strong well after residential construction had bottomed out. But the other shoe is finally dropping, and commercial construction appears set to face harder times for the next few years. U.S. commercial construction surged 12.9% in 2007, responding to high occupancy rates and easy financing. But new activity dropped sharply in the fourth quarter as financing became more difficult and employment growth slowed. We expect new commercial starts to weaken further in
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| Sector: | Asset-Backed Commercial Paper, Asset-Backed Securities, Building Materials, Collateralized Debt Obligations, Commercial MBS, Corporations, Financial Institutions, Global Issuers, Insurance, International Public Finance, Public Finance, Real Estate Companies, Residential MBS, Retail, Servicer Evaluations, Sovereigns, Structured Finance, Utilities
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