Some local construction companies could be scrambling by summertime in search of heavy equipment like cranes, scissor lifts and backhoes for their projects.

With a number of large commercial construction projects ramping up across the city between now and then, equipment is expected to be in short supply and high demand.

“Word on the street is that by mid-summer there isn’t going to be enough equipment for purchase or for rental because of all of the big projects going on in the area,” said Erin Murphy, president of the Associated Builders and Contractors of West Tennessee. “It’s expected to wipe out the local equipment fleet, which will hurt local contractors doing smaller projects.”

The shortage will undoubtedly mean higher rental rates and possible delays for some smaller projects.

“Considering the big projects at Electrolux, Mitsubishi, The Pyramid, St. Jude’s, the new hospital in Olive Branch and possibly the Greentech automotive plant, if they all hit at the same time there’s not going to be any equipment in Memphis to be rented and rates should go up,” said David Prince of Sunstate Rental Co., who believes prices could continue to rise for as long as a year to two years as the large projects are built out.

Sunstate rents standard equipment like reach forklifts, mini excavators, trenchers and boom lifts. Other local equipment rental companies include United Rentals, H&E Equipment Services, Williams Equipment & Supply, RSC Equipment Rental and others.

“Compared to three years ago most construction materials prices are still below where they were. Over the past three years, there’s been a significant drop – up to 50 percent – in monthly rental rates for the larger pieces of equipment,” said Flintco Construction Co. vice president Tim Weatherford. “But in the past few months we’ve actually seen those prices start to increase due to tightening demand.”

The current local rental cost for a 60-foot tower crane is roughly $15,000 per month, down from as much as $28,000 a few years ago.

Flintco rents larger pieces of equipment like tower cranes and material/personnel hoists for some of its projects, while using its own internal equipment yard to supply some of the smaller pieces. The builder is currently using a tower crane on the new parking garage at Memphis International Airport as well as a mobile crane to remove the old Federal Aviation Administration tower. It will put up two cranes soon for work at St. Jude Children’s Research Hospital.

Memphis remains a very affordable market for building equipment compared to other cities. Sixty-foot boom lifts, which rent for up to $3,300 per month in Oklahoma City, go for $1,250 to $1,800 here.

But that is all expected to change as summertime nears. Prices are already beginning to creep up.

Another reason for the upcoming rate increases will be the rising cost of the materials used to build them.

“Steel and copper have been on the increase for about six months now,” Weatherford said. “Based on the projections by the economist from AGC (Associated General Contractors) pricing indexes will be increasing for the 2012 calendar year for construction materials.”

Iron and steel prices jumped 10.4 percent in 2011, while fabricated structural metal products jumped 5.5 percent, according to national statistics from the Associated Builders and Contractors Inc.

Overall, materials prices fell 0.9 percent in the fourth quarter of last year, but they were still 5.3 percent higher than one year prior. The drop late last year was partially attributed to slumping worldwide demand for construction.

Despite the fluctuations in pricing, Joel Thomas, chief financial officer at Montgomery Martin Contractors LLC, does not think equipment and materials prices as a whole have affected local construction that much up to this point.

“There’s lots of activity all across the city from architects, owners and contractors right now including the Electrolux, Mitsubishi and airport projects, so there’s no indicator that pricing is slowing things down,” said Thomas, whose company just finished the first phase of demolition at The Pyramid. “There are still a couple more phases of redevelopment of The Pyramid before Bass Pro Shops takes it over, and then once that happens there will be neighborhood redevelopment around it as well. So there are quite a few great opportunities for construction coming up.”