Non-res sector drives building permit decline in January, Stats Can reports

The non-residential sector was the driving force behind a decline in the value of building permits issued across the country in January, Statistics Canada reports.

The total value of building permits issued by Canadian municipalities fell 12.9 per cent to $6.1 billion in January, following a 6.1 per cent increase the previous month. Lower construction intentions for non-residential buildings in Alberta, British Columbia and Ontario were responsible for much of the national decline.

Construction intentions in the non-residential sector fell 22.8 per cent to $2.0 billion in January, following a 15.0 per cent increase the previous month. Decreases were recorded in eight provinces, with Alberta, British Columbia and Ontario accounting for most of the drop. Quebec (+54.3 per cent) registered the largest increase.

In the residential sector, the value of permits declined 7.0 per cent to $4.1 billion, following a 1.5 per cent increase in December. Decreases were registered in every province, except Saskatchewan, as a result of lower construction intentions for multi-family dwellings. Ontario, Quebec, British Columbia and Manitoba posted the largest declines. Saskatchewan posted an increase in the value of both single and multi-family dwelling permits.

Declines in all non-res components

Canadian municipalities issued institutional building permits worth $387 million in January, down 49.8 per cent from December. This followed a 15.2 per cent increase the previous month. The value of institutional building permits was down in six provinces, with Alberta and, to a lesser extent, British Columbia accounting for much of the monthly decrease. The decline at the national level was the result of lower construction intentions for educational institutions, medical facilities as well as nursing homes and retirement residences. Ontario posted the largest gain in the value of institutional building permits.

The value of commercial building permits fell 8.0 per cent to $1.3 billion, following a 15.1 per cent increase in December. This was the result of lower construction intentions for a variety of commercial buildings, including hotels and restaurants, warehouses and office buildings. Declines were recorded in seven provinces, with British Columbia, Alberta and Ontario posting the largest decreases. Quebec (+110.6 per cent) registered the largest increase in the commercial component.

In the industrial component, the value of permits was down 22.8 per cent in January to $337 million, following a 14.2 per cent increase the previous month. The decrease was mainly attributable to lower construction intentions for transportation-related buildings and, to a lesser extent, manufacturing plants in several provinces. Gains were registered in four provinces in this component, led by Quebec.

Alberta, BC and Ontario post the largest decreases

The total value of permits was down in eight provinces in January, with Alberta, British Columbia and Ontario registering the largest declines.

After posting a 32.6 per cent increase in December, which came mainly from permits issued for institutional projects, Alberta registered a 27.2 per cent decrease in January.

In British Columbia, the decline was attributable to lower construction intentions in both the non-residential and residential sectors. Ontario registered a decrease in January on lower construction intentions for multi-family dwellings as well as commercial and industrial buildings.

The largest gain occurred in Quebec, with commercial buildings and single-family dwellings accounting for most of the increase.

Lower construction intentions in most CMAs

The total value of permits was down in 23 of the 34 census metropolitan areas (CMAs). The largest decreases occurred in Edmonton, Vancouver and Calgary.

The declines in both Edmonton and Vancouver were attributable to lower construction intentions for commercial and institutional buildings. In Calgary, multi-family dwellings, as well as commercial and institutional buildings were responsible for the decline. All three of these CMAs posted notable gains in December.

The largest gains occurred in Montréal, followed by Québec. In Montréal, commercial buildings contributed the most to the monthly increase, while in Québec the advance came from the non-residential and residential sectors.