BARSTOW - Declining demand for new homes has caused some local contractors and building supply companies to readjust their businesses to meet changing market conditions.

Companies across the region are feeling the slowdown, said Carlos Rodriguez, deputy executive director of the Building Industry Association, Baldy View Chapter which represents home builders.

"There was a 50 percent reduction in building permits countywide. We're optimistic that we'll have an increase in 2008," he said.

He said that in Barstow, like many cities, expectations of housing growth were not met as a result of the national housing slowdown. In 2007, city officials expected to issue 250 single-family building permits, but only issued 107 permits as of November, he said.

"I wouldn't say that Barstow is alone is some of the challenges that are being experienced in the residential building industry. Some companies are having to tighten their belts," Rodriguez said.

At building supplier Valley Ace Lumber and Hardware, the slowdown caused them to temporarily lay off nine employees last week as the company adjusts to changing conditions, said company co-owner Larry Collins. The company's general manager Jack Peterson said the move was needed to restructure the company to better compete in other markets.

Both Collins and Peterson were adamant that the company, which employs 75, remains strong.

"We are right-sizing as we are looking at a much stronger situation in first and second quarters 2008," Peterson said. "We continue to invest in other business areas. We are, in fact, looking for some new employees in some areas."

Other companies say that while they haven't reduced their staffs yet, the downturn is causing them to change strategies.

"When construction slows down, we slow down as well," said Julie Clemmer, president of Brubaker-Mann, which manufactures rocks for roofing and landscaping.

She said that due to diminished demand she assigned some of her staff members to special projects, such as dismantling obsolete equipment.

"We've always taken advantage of the good times," she said. "When the downturn comes, it hits us as well. It's going to swing back. This has happened my entire 30-year career."

Some smaller companies expect that growth in the commercial and industrial construction markets will make up for the housing decline.

"Right now, commercial is going great guns still," said Matt Nicklaus, general manager of Haver Glass. "It's only a matter of time before industrial starts to follow it."

He said that the company will weather the lean times.

"Things are a little bit slower compared to the last two winters, but it's not that bad," he said. "We've haven't had to let anybody go or anything like that."

Rodriguez, of the Building Industry Association, said that to encourage housing developers to continue building, his group would like to work with the City Council to delay the implementation of the city's recently enacted development impact fees 12 to 18 months while the market recovers.

"Ultimately at the end of the day if government continues to add regulations and additional fees they'll make it that much more difficult for us to keep the final product affordable," he said. "If the fees continue to go up and up, its going to discourage development."

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