Okanagan-wide building and real estate boom in 2016

Penticton Mayor Andrew Jakubeit said 2016 is expected to set an all time record for building projects.

Early-stage construction at Penticton Regional Hospital.

As big a project as the Penticton Regional Hospital expansion is, it’s only the tip of the iceberg when it comes to the city’s boom in construction and real estate.

Penticton Mayor Andrew Jakubeit said 2016 is expected to set an all time record for building projects. According to the city’s building department, year to date construction value (to the end of November) is almost $189.5 million, compared to $56.5 million for the same period last year.

“The hospital is a huge driver of a lot of this, the prison being built and opening up, employment is driving a lot of it. We are getting a lot of retirement happening here,” said Blake Laven, planning manager.  “It is just an all around good economy is helping out.”

Along with permits for the first two phases on the Penticton Regional Hospital expansion, building and permitting manager Ken Kunka said other major projects include the new Cascade Casino, expansion of the Lakeside Resort and the first of three towers for Starline’s residential complex on Skaha Lake Road.

Read more: Gateway Casino announces Penticton relocation

“And then we had two five-storey apartment buildings walk in out of the blue, referring to the Duncan Avenue project and another proposed for Kinney Avenue.

Along with the major projects, Kunka said the residential sector is also going strong.

“I think 30 permits for Sendero (Canyon) are coming in,” said Kunka. “Incredibly strong numbers on  residential, which is good long term for the city.”

Laven agrees it is a good mix of projects across the board, from a big box retail development through residential and development. Work in the planning office, he explained, reflects what the building permit department sees six months down the road.

“I think all indicators are point towards 2017 continuing the trends,” said Laven. “November was one of the busiest months on record for the planning department, so that just gives you an idea people are anxious to get going in the spring.”

Like the Sendero Canyon residential project, Skaha Hills is also booming, having sold out their first offering of terraced ranchers in a single day. To date, 118 new homes have sold in the residential community since the first release of Phase I in 2014.

Read more: South Okanagan real estate market booming

The building boom being felt in Penticton is carrying over across the Okanagan — construction industries in both Kelowna and Vernon are thriving.

Kelowna Mayor Colin Basran said earlier this fall as of July, there had been a 51 per cent increase in housing sales volume over the same six months in 2015.

Prices for houses have gone up by $100,000 this year over last, commercial construction has seen an upswing, and the skyrocketing real estate values in the Lower Mainland have driven more buyers to Kelowna.

The downturn in the Alberta real estate buyers in the Central Okanagan has been off-set by an almost identical upswing in Vancouver house shoppers and real estate investors, according to the Okanagan Mainline Real Estate Board.

While sales have dipped in November, a traditionally slow time in the residential real estate sale business, the impact of the 15 per cent tax on Vancouver homes to non residents is still not definitive for this region.

Besides new home construction, there has also been a renewed influx in rental property development, a welcome sign for Kelowna City Hall given the dismal rental vacancy rates in the city which is escalating housing rental rates due to high demand and low supply of rental housing inventory.

Basran also noted this year the growth of the high-tech sector in Kelowna, reflected in part by the increasing number of families moving to the city, brought by new job creation, a demographic change from the city largely being a magnet for retirees.

The story is much the same in Vernon, where building permits issued for the first six months of 2016 were up 14.7 per cent over the same period for the previous year.

Land use applications, which include development permits, rezoning, subdivision and soil removal/deposition, increased 42.6 per cent in the first half of 2016 compared to the same period in 2016.

Vernon Coun. Brian Quiring told the Vernon Morningstar earlier this year why construction was on the upswing in his community.

“Our relatively low housing costs compared to the rest of the province is likely helping, “ he said.

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