Construction investment strong in September amid quarterly declines
By Adam Freill
Commercial Construction Industrial Institutional ResidentialCommercial building construction investment continues on a slow slide while residential growth strikes in the multi-unit sector.
Investment in non-residential building construction, September 2023. (Source: Statistics Canada, Table 34-10-0175-01–Investment in Building Construction.)
A 0.2 per cent dip in the commercial segment was the only slip to be found as investment in building construction increased 5.3 per cent across Canada in September. The $18.9 billion posted resulted from a 7.3 per cent jump in residential spending, which came in at $12.9 billion, and a 1.2 per cent increase in the non-residential sector, which reached $6.0 billion.
Growth in residential investment was driven by Ontario, which rose almost seven per cent, Quebec’s rise of more than nine per cent, Alberta’s 10.6 bump, and a whopping 34 per cent spike in Manitoba.
Looking at the national picture, single-family home investment increased 6.4 per cent to $6.3 billion in September, while multi-unit construction rose 8.2 per cent, to land at $6.6 billion for the month. All provinces reported gains in that component.
In the non-residential world, institutional investment was the key driver, rising 4.3 per cent to $1.5 billion. Ontario’s 11.4 per cent gain led the way as a large hospital renovation in Toronto and the construction of a correctional facility in Thunder Bay contributed to growth in the province.
Industrial construction investment increased 1.2per cent to $1.2 billion for the month. Despite stabilizing in recent months, industrial investment is still up more than 16 per cent from the same month last year.
The lone component to edge downward in September was commercial construction investment, which slipped marginally to $3.2 billion.
Taking a national look across the quarter, investment in building construction fell 2.8 per cent to $54.7 billion in the third quarter, the fourth consecutive quarterly decrease. Much of the Q3 loss can be attributed to the residential sector, which was down 4.4 per cent in the third quarter. The non-residential sector finished the quarter up by a half-per cent, reaching $17.9 billion.
Quarterly gains were posted in multi-unit construction investment, which edged up 0.1 per cent to $18.7 billion; institutional construction, which was up 2.4 per cent at $4.5 billion; and industrial construction investment, which nudged up 0.2 per cent to $3.7 billion. Commercial investment experienced a slim decrease of 0.3 per cent to sit at $9.8 billion.
