By Mara Watts

Ivan Franklin, vice president of construction lending for Mitsubishi HC Capital America, says the demand for construction rental equipment has grown due to the increase in purchasing cost for construction machinery, rising interest rates and economic uncertainty.

“ More and more contractors are shifting towards renting equipment due to the flexibility it provides,” he said.“ We see the biggest surge in demand for earthmoving equipment, material handling equipment and concrete and road construction equipment.”

Financial and Business Benefits

For construction firms, renting offers several financial advantages over purchasing, including:

Financial Flexibility:

Renting equipment helps companies avoid significant upfront capital needed to purchase machinery, which frees up cash for other business needs.

“ Rental payments will often be lower than payments on a loan to purchase the item and will also provide a flexible term based on the current project or need for the asset,” explained Franklin.“ Another cost saving is the absence of costs of warranties, insurance, transportation and storage, which will free up more cash to support business growth.”

Maintenance:

“ Renting eliminates the recurring costs associated with maintenance, repairs and storage of the equipment,” said Franklin.

Manage Depreciation:

Equipment – especially heavy equipment and anything techrelated – depreciates over time. And, according to Franklin, an asset’ s value at the end of loan payoff could be substantially less than the purchase price, making rental an attractive option for avoiding depreciation losses.

Technology: Renting equipment with newer technology can increase productivity, improve accuracy and reduce costs. Additionally, renters avoid equipment obsolescence and add more efficient machines to a fleet.

“ Lower monthly payments that generally come with renting may enable you to afford better, or newer, equipment than you could obtain if

22 l July-August 2025