Construction activity holds steady through pandemic
Construction activity could have sunk in 2020 but instead wound up treading water, and observers are expecting better flow in the year ahead.
New figures for building and development in Medicine Hat during the pandemic year show that while no new major projects were approved, several were completed, and residential activity shifted from new home building to an “astronomical” increase in renovation projects.
“It’s something we tracked early on,” said Kent Snyder, the city’s manager of building and planning services.
“It was year of no new major projects (acquiring building permits), but we see an astronomical increase in smaller projects.”
Final figures from last year show an actual boost in new home projects thanks to a lateyear surge, but also that house additions accounted for 46 per cent of all residential building permits in 2020. That is compared to just six per cent in 2019 when one-fifth fewer permits were issued.
It’s a major swing attributed to homeowners stuck at home during the pandemic, more willing to improve their properties.
That said, new home starts also improved to 37 for the year, up from a low of 20 one year earlier, and developers added new subdivisions and paid off-site development fees.
“There are indicators that 2021 will be a better year in terms of number of permits and value (connected to) permits,” he said. “It may not be a substantial spike, but a road to recovery.”
For the whole year, building permits’ estimated value was $48.8 million across all sectors, down from $90.6 million in 2019.
The key difference was two large projects — a school in Saamis and the Cancarb expansion — were approved in 2019, though construction carried over.
The current statistics count only building permits, required at final stage when construction is about to begin, not development permits that can be used to forecast activity.
Several large development permits, including a $35-million long-term-care facility, are already approved, but aren’t yet connected to building permits.
Two contractor associations in Medicine Hat also say 2020 wound up beating expectations after a hardscrabble start, and they see improvement this spring and summer.
“Generally the trend was toward smaller projects in 2020,” said John Digman, of the Medicine Hat Construction Association. “We’re pleasantly optimistic for 2021.”
Joel Bosch, president of the local chapter of the Canadian Homebuilders Association, says local builders are ready for a better 2021.
“It was a bit of a different year,” he said. “A lot of people put projects on hold, but that changed in the fall. It was still a pretty good year considering.
“On my end we’re seeing a lot of plans coming in, and permits (applications) going in. I’m definitely optimistic.”
Beyond private-sector projects, regional, industrial and public works projects could stabilize job numbers and the outlook for tradespeople.
Up to $20 million in new city projects connected to grant funding from Ottawa and the province will need to be bid on and completed by the end of the year.
That includes trail construction and expansion, a major remake of Athletic Park, resurfacing the 603 First Street parking lot, new office space in the downtown, and a major outdoor pickleball facility.
Regionally, up to three major greenhouse expansions and planned, plus wind and solar facility construction.
The city will also complete most of the work on a Unit 17 power plant expansion in 2021. Medicine Hat College has an expansion planned, and the provincial government highways budget will be boosted with maintenance and twinning portions of Highway 3.
“If there’s one thing that 2020 taught us is that it’s important to look outside the local area to find work,” said Digman. “On the reverse side, there are large companies is places like Calgary and Edmonton that are looking farther afield as well.”