MINNEAPOLIS-Kraus-Anderson Construction Co. says it took its licks like everyone else in the recession, dropping annual revenues almost in half, from $800 million in 2006 to $473 million in 2009. However, the company says the construction industry is coming back, as the firm has signed more than $372 million in new business in just the past two months -- in part by cutting back on commercial construction.

Instead, the Midwest-focused firm has expanded new business into three areas: education, health care and senior housing, says COO Alan Gerhardt. “We felt these markets are recession-resistant,” he tells GlobeSt.com. “It was clear that projects in certain industries would remain in a holding pattern, so we directed our attention to those sectors where major construction was more likely.”

Gerhardt says the commercial property industry is practically on hold, because the resurgence triad hasn’t been met: A return of the stock market, positive GDP and job creation. The first two are there, but “we’re in a jobless recovery,” he says. “I think it’s going to be at least mid-2011 before we see sustainable recovery in the commercial sector.” Many commercial experts would say that construction should stay off the table for a few years, at least until vacant space can be absorbed.

For now, construction firms are focusing on more public-orientated work. Gerhardt says the only non-commercial segment that’s not quite mature yet is senior housing. “The demand is there, but the financial markets are not yet ready to provide the level of financing that the demand would like to see happen,” he says. “Everybody continues to get older. When financing loosens, it will be a big slug in the pipe, a large boom in the senior living market.”

Health care has seen a kick from the Obama administration’s reforms, and the federal government is also paying for a lot of new projects. Gerhardt says his firm is plugged into these markets, including the 400,000-square-foot Gunderson Lutheran Hospital project in LaCrosse, WI and a five-story office building for the FBI here in Minneapolis, being developed by the Molasky Group of Cos.

Local governments have cut spending because of lower housing revenue, but school districts and colleges for some reason seem to be pumping out projects, Gerhardt says. Current projects by the company include a 125,000-square-foot academic building for Gustavus Adolphus College in St. Peter, MN and the 83,434-square-foot, K-12 Crow Creek Tribal School in Stephan, SD.