City building permit values up by 56% in 2011
Big spike in commercial development
City of Calgary building permit values in 2011 reached $4.54 billion, the third-highest ever.
According to data released Friday by the city, values were up 56 per cent compared with 2010s $2.91 billion.
They are also 10 per cent higher than the five-year average of $4.12 billion and up 27 per cent compared with the 10-year average of $3.58 billion.
“The year 2011 marked a big shift for Calgary, a city transitioning from a time of reduced spending. Estimated construction values are at some of the highest levels we’ve seen.
“Contributing factors this year are the increase in new builds over improvements, a significant source coming from apartments and commercial segments,” says David Watson, general manager of planning, development and assessment for the city, in a statement.
Permits for new residential units in 2011 were 9,812 com- pared with 7,026 in 2010, a 40 per cent increase. Of the 9,812 units, 3,412 are for new apartments, which is a 189 per cent increase.
The city also experienced an increase of 190 per cent in the value of new commercial construction permits this year. In 2010, the total value was $151 million compared with $438 million in 2011. There were also significant gains in the commercial improvements segment, with a total estimated value of $240 million. This is an increase of 45 per cent in estimated value in 2011.
“In just one year the city has bounced back from a threeyear decline in building permit values thanks in part to big gains in the commercial and apartment sectors. In general, new commercial and apartment spending is a good sign for Calgary’s economy,” Watson said.
The city hit peak building permit levels in 2007 with $5.62 billion in estimated construction value. This was followed by three years of decline to a five-year low of $2.91 billion in 2010. This year also saw a hike in projects valued over $10 million — 44 projects in 2011 compared to 22 in 2010).
Some of these projects include the airport’s International Facilities Project ($596 million), Eight Avenue Place– West Tower ($195 million), University Residential Towers ($55 million) and Mount Royal Conservatory and Concert Hall ($53 million).
Dan Sumner, an economist with ATB Financial in Calgary, said the real strength in 2011 was on the non-residential side. The numbers might be “a little bit skewed” by the airport development, he said. “The residential side of things was rising from really a pretty low level in 2010.
“Looking forward I would expect to see further increases on the residential side in 2012. We definitely expect housing starts to slowly start to trickle back up. Not a big increase, but a pretty decent size increase.
“On the non-residential side, things are a lot more uncertain just because non-residential construction tends to be a lot more volatile and we’re not going to see another $600-million airport project.”