Hamilton construction up a whopping 30 per cent in the first six months of 2019
Some of the increase is explained by developers rushing to avoid new development charges that went into effect in July
https://www.thespec.com/news-story/9...onths-of-2019/
Hamilton is having a record-breaking year in construction, with a 30 per cent increase over 2018 for the first six months of the year.
According to new figures from the city's Planning and Economic Development Department, there was $800 million in construction activity from January to June 2019 compared to $619 million in the same period last year.
And 2018 was very strong, finishing the year with $1.26 billion in construction, the second highest ever.
The figures are produced by having developers estimate the value of their projects when apply for building permits. Those figures are tallied each month to get a sense of how the construction sector is doing.
Glen Norton, the city's director of economic development, said he believes some of the activity in June is explained by developers wanting to avoid new development charges that were to come into force in July.
"Our development charges went up July 6, so builders who have projects coming would want to get their building permit applications in early to lower the rate," he said.
The charges vary depending on the type of construction but, Norton said, in the case of multi-unit residential construction, it will mean thousands of dollars per apartment.
The increases, he said, were put into place because city council believes "growth should pay for growth. So suburban types of development that require more infrastructure from the city are going to pay more of the development charges."
The biggest project recorded in June, was a $65-million, 251-unit apartment development on Dundas Street East in Flamborough — by Flamborough Centre Properties — followed by a $32 million addition project at McMaster University. Details were available about the McMaster construction.
Norton said the record-breaking six month total across the city is both a reflection of developers rushing forward to avoid additional costs but it also a sign that the construction industry is continuing to boom in the city.
"Both factors are at work in explaining the increase," he said. "It's going to be a good year. There is no doubt about it. We're clearly going to pass the $1 billion mark again for the year.
"It's the exodus from Toronto. We are relatively affordable for residential, commercial and industrial developments. Hamilton is becoming a viable alternative, not just to live but as a place to bring business from Toronto," he said.
The report says residential construction was up 12 per cent — in the first six months of the year — compared to the three year average, whereas industrial, commercial and institutional construction was up by 59.5 per cent.
June's report follows a previous month's report from the city's planning and development department that had a major miscalculation — because of an extra zero added to one project.
A $12.7-million City Hamilton Housing Corp. buildingon MacNab Street North was mistakenly counted as $127 million. So instead of a 30 per cent increase in overall construction activity for the first five months of the year — as compared to the same period in 2018 — the increase was really 9 per cent.
Asked whether there might be a calculation problem with the June report — that found a 30 per cent increase — Dio Ortiz, a spokesperson for the department, said "we're more than confident that it is accurate."
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