Following extended site clearing and planning, construction began on a new-Nanaimo Correctional Centre in April, 2022. This project is the largest public investment in infrastructure for this year, with $63 million invested so far. (Ian Holmes/NanaimoNewsNOW

By Jordan Davidson

record pace

Nanaimo building permits on track for record-setting year

Jul 23, 2022 | 6:01 AM

NANAIMO — The City of Nanaimo is on pace for another record-breaking year for building permit values.

As of June 30, building permit values were $319 million, which puts it on pace to break the 2019 record of over $445 million.

Director of development approvals Jeremy Holm said there are a few factors playing into this, namely demand and higher construction costs.

“Market demand is a key factor, relatively low vacancy rates still, growth in Nanaimo and interest in Nanaimo are high, and we’re seeing the response to the market demand for housing. There are other permits, but housing is a big part of what we’re seeing in those values.”

As of June 30, the City cleared 1,085 residential units to be built, which includes 916 multi-family units — a record pace for this time of year.

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Part of the City’s affordable housing strategy goal is for 70 per cent of new homes to be multi-unit developments. In 2021, those units made up 76 per cent of all residential permits within Nanaimo.

Officials at City Hall expect the housing density trend to continue.

“We’re definitely on track for that (70 per cent) at this point in the year, I believe we are at 84 per cent multi-family as a percentage of units permitted… yet to be determined obviously what this year finishes at, but definitely a strong start to the year in the multi-family side.”

Holm told NanaimoNewsNOW inflation is also a big factor in building permit values, as it is affecting prices in nearly every aspect of society.

“The cost of construction is higher now than it was at this time last year or the prior year so that’s going to drive up the permitted construction value. It doesn’t impact the unit numbers we’re reporting on, but the permitted construction value has to factor inflation in.

$68 million is the total public investment so far this year, with $63 million of that going towards building a new Nanaimo Correctional Centre. That project involves multiple permits with an estimated completion date of 2024.

The other $5 million of public investment money comes in the forms of infrastructure like roads and upgrades to underground utilities, some of which are already facing delays due to being over budget.

Holm said while they are on track for a record year right now, it’s difficult to predict what will happen for the remaining six months of 2022.

“It’s interesting times and there’s a lot going on in the world in the way of global events, economic pressures, and inflation are obviously factors as are interest rates.”

With a volatile market in play, Holm said he would be surprised if the second half of the year finished as strong as we started.

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jordan@nanaimonewsnow.com

On Twitter: @JordanDHeyNow