Local economic outlook has brighter future
Debt ceiling and spending limitation events in the nation’s capital last week notwithstanding, the economic outlook in West Michigan for the month ending is reported to be stronger than the rest of the country … and still tracking for economic growth to end the year.
Brian Long, Grand Valley State University director of Supply Management Research at the Seidman College of Business, reported in his monthly survey that employment continued to grow, even while purchases fell from the previous month. Purchasing managers in the Grand Rapids area cited the “negativity and anxiety” rivaling that of the advent of the Great Recession, and in anonymous comment also advised, “We need to keep the speculators from their kneejerk reactions to any little change. This just adds more confusion to the current economic issues.” That said, some reported a slowing in orders, somewhat predicated by greater industry reliance on sub-contracted work and longer delivery times; others continue to report “record demand.” Long’s assessment is that the growth rate in the Grand Rapids metropolitan area has become “modest.”
There is, however, an unexpected and optimistic forecast from area developers (which may also bode well for pending relief in the construction industry). Business Journal reporters preparing stories for the commercial real estate focus were given newfound hope by these community investors, who are finding that the relationship between banks and developers are settling back to more “normal” business, though certainly with new guidelines.
Independent Bank Senior Vice President Jose Infante noted that manufacturers that have survived the recession also now have bigger market shares. Perhaps more important to the crippled commercial real estate industry, Infante said, “We are seeing rental and price stabilization in products in commercial real estate. As a result, you’re seeing the beginning of additional investor dollars coming back into the area.”
Robert Grooters, Grooters Development Co., also noted the drop in vacancy rates in the commercial/industrial properties, from 17 percent to 8 percent. “It is an amazing market right now,” he opined.
The comments from the purchasing managers who continue to be watchfully realistic, added to that of Grooters, offer a far more calming examination of real numbers — gratefully, a far cry from the indicated death knell in Washington last week.
Grooters offers a final observation: “Our town is getting back to the shining side again, including the industrial side. And that’s what we need. It’s what generates the jobs.”