The widespread weakness reflects high and rising vacancy rates, an extremely tight financing environment, and sinking property prices that reduce the expected profitability of new projects.
Because of the lumpy nature of these investments and the long time that it takes to plan and develop new projects, movements in outlays for nonresidential structures often lag movements in overall output, and, given the strong headwinds in this sector, I expect that any recovery in this area will be particularly slow to emerge.