FEBRUARY 2017 – BUILDING PERMITS UPDATE
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ICI permit values in the GTA were up by 17% overall compared to the fourth quarter of 2015. This growth was led by the commercial sector which saw an increase of nearly two-thirds. The gulf between the industrial and commercial sectors, which was observed in third quarter continued to grow in the fourth quarter. Industrial permit values in Q4 declined by 60% year-over-year, while commercial permit values increased by 65%. Industrial permits for the fourth quarter totalled $116 million, which was the lowest quarter in six years. Commercial permit values on the other hand surpassed $1 billion for the second consecutive quarter. Looking at 2016 as a whole, industrial permit values amounted to the lowest level since the recession. Commercial permit values amounted to over $4 billion for only the second time ever.
The diminishing size of the GTA’s industrial sector relative to the ICI industry as a whole is highlighted by the percentage size of Industrial permit values relative total ICI permit values. In 2016 industrial permit values accounted for 12% of total ICI, the lowest for at least the past two decades. 2017 could be a better year for the GTA’s industrial sector though. CMD Group forecasted a significant increase in the value of manufacturing construction starts in the GTA, from $63 million last year to $176 million in 2017. They also forecasted a decline though in warehousing construction starts, down from $291 million last year to $163 million in 2017.
The GTA’s Institutional permit values declined by 7% year-over-year in the fourth quarter. Total institutional permit values for 2016 were down compared to 2015, but compared to the past 5 years, the 2016 permit values were slightly above average. Hospital construction is expected to be a major source of work in the industrial sector in the coming months. CMD Group forecasted a $200 million increase in the value of hospital construction starts in 2017. Infrastructure Ontario closed bidding on the Mount Sinai Hospital Redevelopment in January with a winning bidder expected to be announced this Spring. Infrastructure Ontario is also planning to release an RFQ for the Macdonald Block Reconstruction Project this Spring.
The GTA Region includes: City of Toronto, City of Oakville, Durham Region, Peel Region, and York Region
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FOR MORE INFORMATION, CONTACT:
Ian Worte
Research Analyst,
ianw@iciconstruction.com
Ontario Construction Secretariat (OCS)
180 Attwell Drive, Suite 360, Toronto, ON M9W 6A9
P 416.620.5210 ext. 241
F 416.620.5310