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CanaData starts in November included more privately-funded projects

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Alex Carrick

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Alex Carrick is Chief Economist for CanaData, Reed Construction Data’s Canadian economic forecasting and statistical service.

Economists

CanaData’s starts statistics still looked barren through November. In square footage, commercial work was about half of what it was last year and industrial starts were only about one-quarter as high. It is clear that the two segments of the overall market that have held up better are in the public spending area – institutional and engineering.

CanaData’s starts statistics still looked barren through November. In square footage, commercial work was about half of what it was last year and industrial starts were only about one-quarter as high. The breakdown within the commercial category was especially interesting. Hotel and private office building starts have declined by 75% year to date. The important retail category has held up a little better at -50%. Warehouse and storage buildings are -43%. Commercial work is mainly private-financing driven, but where there is government money, the results have been better. For example, recreational buildings are -24% and government office buildings are +21%.

It is clear that the two segments of the overall market that have held up better are in the public spending area – institutional and engineering. Institutional starts are only -10% in square footage year to date in 2009 versus the same period in 2008. Hospital starts have been weak (-58%), but medical and welfare buildings (+13%) have partly compensated. Educational buildings (+12%), in the meantime, have been quite strong, relatively speaking. Engineering starts, which are only recorded in dollars, are -6% year to date. Engineering starts in November alone performed well.

Among the engineering project starts in the latest month were some headline-grabbing large projects including: the Port Mann Bridge for the B.C. Ministry of Transportation; Sunrise oil refinery work for Husky Energy Inc. in Alberta; and a beginning of work on the Spadina Subway extension, Downsview Station to Wilson Yard, for the Toronto Transit Commission.

There has been one interesting development in the monthly results. November’s Top Ten list includes more private-sector projects than at any time going back to the first quarter – three in the commercial category and two in residential. The commercial projects were a 10-storey office building in Quebec City, a LEED gold-certified office building in Toronto and a shopping centre in Saanich, B.C. Both of the residential projects were in the Toronto CMA - in Etobicoke and Markham. Please click here to see the Top Ten list and the moving-total trend graph.

Alex Carrick

Find Canadian construction-related economic articles in Canadian Construction Market News and in the Economic Outlook section of Daily Commercial News. Mr. Carrick also has a lifestyle blog that can be reached by clicking here.

by Alex Carrick

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