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CPABC: Despite COVID-19 pandemic, Northeast B.C. housing starts and major project activity picks up speed

FORT ST. JOHN, British Columbia, Feb. 18, 2021 (GLOBE NEWSWIRE) -- According to BC Check-Up: Invest, an annual report by the Chartered Professional Accountants of British Columbia (CPABC) on investment trends across the province, the number of housing units that began construction in Northeast B.C. increased by 40.0 per cent in 2020 compared to the number started in 2019.

“Northeast B.C., which is home to a wide variety of natural resource and industries, has offered investors an excellent place to allocate their capital,” said Ben Sander, FCPA, FCA, partner at Sander Rose Bone Grindle. “While the economic uncertainty from the COVID-19 pandemic put downward pressure on housing investment in the first half of 2020, the number of housing starts in the region’s largest municipalities bounced back in the second half of the year.”

Over the course of 2020, 105 housing units began construction in Dawson Creek and Fort St. John, up from the 75 units started in 2019. The housing starts were concentrated in Q3 (27) and Q4 (56) 2020, with just 22 units starting construction in the first half of the year.

This increase was due to a 165.0 per cent jump in the number of attached units started, such as condos and townhomes. In total, 53 attached units began construction in 2020, up from just 20 in 2019. Meanwhile, 52 detached housing units started construction in 2020, down 5.5 per cent from the 55 started in the previous year.

The recovery in housing investment through 2020 was driven by smaller, attached units. While there was a small dip in detached starts, the region fared much better than the provincial average where overall starts were down nearly a fifth,” continued Sander. “Another positive sign in 2020 is that, despite the economic turmoil, the region continued to see increases in the amount of capital being allocated for major projects.”

As of Q3 2020, the total estimated cost for major capital projects – defined as those with a capital cost over $15,000,000 – in Northeast B.C. increased by 9.3 per cent in Q3 2020. Collectively, major projects currently proposed, under construction, or on hold stood at $40.3 billion, accounting for over 10 per cent of all projects across the province. Despite uncertainty about the future of the project, the $10.7 billion Site C construction site continues to be largest project under construction.

“While it is promising to have these mega projects providing economic activity to the region, it is critical that the benefits are realized across our communities. Despite ongoing activity, Northeast B.C.’s economic activity such as employment has struggled through the pandemic,” continued Sander. “Thankfully, the activity in the natural resource sector has been noticeably up recently and several additional projects are slated to begin soon.”

The five largest proposed projects all related to natural resources with an expected investment of $9.6 billion. They include two projects that are set to begin construction in 2021 – the Sundance Low Carbon Gasoline Refinery ($2.5 billion) and the Sundance Clean Methanol Refinery ($1.5 billion).

“Going forward, there needs to be a coordinated strategy to ensure local residents benefit from the large amount of capital flowing into the region,” concluded Sander. “In 2021, several more projects are anticipated to begin, and there is no doubt they will be a critical component to the region’s economic recovery from the deep 2020 recession.”

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About CPA British Columbia
The Chartered Professional Accountants of British Columbia (CPABC) is the training, governing, and regulatory body for over 37,000 CPA members and 5,500 CPA candidates and students. CPABC carries out its primary mission to protect the public by enforcing the highest professional and ethical standards and contributing to the advancement of public policy. CPAs are recognized internationally for bringing superior financial expertise, strategic thinking, business insight, and leadership to organizations.

For more information:
Vivian Tse, Manager, Communications

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