Nanaimo sets construction record with 2019 boom

Building in Nanaimo is surging after a record-breaking year in 2019 when construction values more than doubled from the previous year.

The boom is largely being driven by strong demand for multi-family housing and by commercial development, along with strong public infrastructural spending.

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Last year wrapped up with $445 million worth of permits approved, an increase from $216 million in 2018.

The 2019 total smashed the previous record of $242 million, set in 2007.

As for how this year is shaping up, Jeremy Holm, Nanaimo’s director of development approvals, said Friday: “We have a fair number of significant projects in for building permits now.”

He will be surprised if 2020 permit values top last year’s, but said: “I would expect it to be well above average again.”

Rory Kulmala, chief executive of the Vancouver Island Construction Association, said Nanaimo is “trending on the higher side” in the amount of development going on.

Like Holm, he is not expecting to see permit values double this year, but agreed that development will continue to be robust.

“We will see it remain fairly high,” Kulmala said. “I think it is going to stay consistent for the next year or two, until such time as we start to see a reduction or a softening of migration to the region and demand starts to reduce. But there is obviously a demand with a very low vacancy — that will always drive investment in residential accommodation.”

Migration to Vancouver Island, including Nanaimo, is spurring demand for affordable and available housing, he said.

In Nanaimo, 2019 saw a total of 1,877 residential units approved. Multi-family has fuelled much of the housing development, representing 1,115 units last year.

Rising interest in higher-density housing is illustrated by the change from 2018 when 430 were multi-family units were approved out of a total 947 residential units.

As in Greater Victoria, Nanaimo is seeing an increasing number of single-family houses built with suites as mortgage-helpers.

Last year, 70% of the 208 single-family homes approved included a suite, up from 60% in 2018, Holm said.

Major development projects in Nanaimo include a 251-unit apartment building on Uplands Drive, a 159-unit affordable seniors’ multi-family building on Buttertubs Drive and a 90-unit residential building on Barsby Avenue.

A key commercial project — a 172-room hotel at 100 Gordon St. — broke ground late last year. The $22-million, nine-storey Nanaimo Courtyard by Marriott is scheduled to open next year and help boost business at the adjacent Vancouver Island Conference Centre.

The municipality has $46 million worth of capital projects planned for this year and completed 54 infrastructure works, valued at $50 million in 2019.

Kulmala, who is meeting next week with Nanaimo officials, said: “Nanaimo, I think, is working to try and allow developers to get their projects to the market, get them out in a timely fashion and not create hurdles when it comes to bureaucracy.”

Industry is “there to do the work and they are.” But “for our industry, it is still a question of available labour.”

B.C.’s construction and trades sector faces a shortage of skilled trades workers at a time when other sectors are also trying to lure newcomers.

Some trades training programs have backlogs of would-be students wanting to get in, Kulmala said.

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