December 1, 2023
Brian Richardson
Brian Richardson, president, L & A Tent Rentals, Trenton, N.J., and American Rental Association (ARA) Region Two director, sees a mix of booming business tempered by rising interest rates and election year uncertainty for mid-Atlantic rental operators heading into 2024.
“Our equipment rental members are optimistic as they continue to do record numbers,” Richardson says. “A lot of it is based on the $3 trillion dollars the U.S. government put into the infrastructure bill in the past year. The majority of that is construction projects. I don’t think you can drive down a highway and not see that money being put to use.”
In the event rental segment, Richardson says, “It’s been a strong 2023. We finally have pushed through the backlog of weddings that everyone had cancelled for two years, so we expect to see a slowdown in the number of weddings we have had since COVID restrictions have been lifted. But also, we’re seeing those parents who want to have that spectacular day for their son or daughter.”
Those same parents’ desires are being tempered by rising interest rates.
“Some of them have taken out home equity lines of credit to pay for that expensive wedding. Now they are pulling back and saying, ‘We’ve got to lower this budget. Interest rates are at 7.5 percent. It just doesn’t make any sense to borrow money for an event that is only going to last six hours,’” Richardson says.
High interest rates also are a looming concern for those in equipment and homeowner/DIY rentals.
“Rising interest rates have made equipment rental companies really think about their investments and what they are going to purchase as far as inventory assets,” Richardson says. “And homeowner rental-specific companies are now looking at the cost to get into a home based on mortgage rates. They are concerned about the homeowner rental market remaining as strong as it has been in the previous three quarters.”
Another factor nagging rental companies across the mid-Atlantic regardless of segment, according to Richardson, is the uncertainty emanating from nearby Washington, D.C. — particularly in an upcoming election year.
“There seems to be a real hesitancy because no one knows what is going on in D.C.,” Richardson says. “It’s hard to say, ‘This is what I want to do, this is where I want to invest next year’ not knowing what the government situation will be. It’s on every business owner’s mind here in the mid-Atlantic. We all will make do with whatever party is in power. Everyone votes for who they prefer, but if you lose, you say, ‘OK, we’ll deal with it.’ This way, we don’t get so uncertain day to day. Not knowing whether there’s going to be a recession or not — it’s concerning for all the business owners here. It’s the uncertainty.”
