Games, Asia trade lead B.C. to 27% surge in 2005 construction
Derrick Penner
Sun
SOURCE: STATISTICS CANADA Vancouver and Calgary saw huge Value of office building construction increases in office tower Vancouver Calgary construction last year. Photograph by : Vancouver Sun
Work continues on athletes village area for 2010 Winter Games. Photograph by : Mark van Manen, Vancouver Sun
British Columbia built more factories, schools, hospitals and office space in 2005 to ramp up non-residential construction activity to $3.9 billion, a 27-per-cent surge from the previous year, Statistics Canada reported Tuesday.
It was construction activity driven by B.C.’s strengthening economy, supported by demand for Olympics-related office space and increasing Asian trade, Statistics Canada said, that helped lead Canada to its fifth-straight year-over-year record for non-residential building.
Alberta, which saw its non-residential construction starts rocket 28 per cent to $4.7 billion, was also cited as a leader in growth, making the surge largely a western story.
Nationally, non-residential construction hit $31.5 billion in 2005, up 8.7 per cent — or $2.5 billion — from 2004, the biggest gain since 2002.
“For B.C. in 2005, I think it’s a record for the three types of building — industrial, institutional and commercial,” Statistics Canada analyst Bechir Oueriemmi said in an interview.
Oueriemmi added that B.C.’s increasing trade with Asia and preparations for the 2010 Olympics appear to be the main triggers for the increase in demand for new space, particularly for office buildings.
New office construction accounted for half of all the growth in non-residential construction, Statistics Canada said. Within the new office investment, metro Vancouver and Calgary contributed a quarter of that growth.
“A lot of companies, they try to have space in advance [of the Olympics],” Oueriemmi said.
Greater Vancouver saw $458 million poured into building new office space during 2005, which was a 45.1-per-cent increase from 2004.
However, Jeff Rank, vice-president of commercial realtor Cushman & Wakefield LePage’s Vancouver office, said factors other than the Olympics or Asian trade played roles in the increase.
“The current drivers for the demand [of] office space in B.C … natural resource companies,” Rank said in a written exchange. “Mining and natural gas companies [as well as] construction and engineering support companies that are related to infrastructure projects and Olympic facility building.
Rank added that while a large piece of Olympics-related office expansion happened in 2004 and 2005, he expects another wave to hit in 2008 and 2009 as “event-specific” office users come to town in preparation for the games.
The growth, he added, has been in the suburbs: Burnaby, east Vancouver and Richmond. However, Rank said that office space downtown will continue to be accommodated in mixed-use buildings such as the new Jameson House, until new highrise sites are identified.
B.C. also saw $643 million invested in industrial projects — factories, mills and other industrial plants — which represented a 43-per-cent increase over 2004.
Manley McLachlan, president of the B.C. Construction Association, said the rise in industrial construction “sort of follows the other [sectors].
“If the residential sector is growing or has grown, that means sooner or later infrastructure has to grow. Then in a healthy economy, you also maintain growth in the industrial sector.”
TOWER POWER
Vancouver and Calgary saw huge increases in office tower construction last year, a major component of the $2.5-billion increase in non-residential construction across Canada in 2005. Office towers accounted for more than half of that $2.5 billion and nearly a quarter of that took place in the two western cities.
© The Vancouver Sun 2006