Investment in Canadian construction reached $15.2 billion in May, up 2.2% from the previous month.
Figures from Statistics Canada released this week show that the gain was led by residential construction investment, up 2.8% to $10.4 billion, while there was a 0.8% rise for the non-residential sector to $4.8 billion. On a constant dollar basis, investment in building construction rose 1.8% to $12.7 billion.
For the residential sector, multi-family construction continues to dominate investment with a 7.6% increase in May to $5.5 billion. The single-family sector was down 2.2% to $4.9 billion.
Around three quarters of the investment in multi-family was down to British Columbia where large projects in Burnaby and elsewhere drove the overall total higher.
Non-residential led by BC
BC also led the gains for the non-residential sector which increased $21 million in the province, closely followed by a $20 million gain for Ontario. However, Alberta weighed on the overall total with a $10 million decline.
Industrial units dominated overall non-res construction investment, with a 1.6% rise to $911 million.
The Conference Board of Canada’s Economist Robyn Gibbard has been digesting the figures.
“Non-residential building construction has grown strongly over the last year, buoyed by very low industrial and commercial vacancy rates in Vancouver and Toronto,” he said. “With vacancy rates remaining quite low, especially in the industrial sector, we should see building construction remain strong. All of this is great news for business investment this year.”
Spending on non-residential building construction grew by 5.5% in the past 12 months.
Gibbard added that the lone dark spot was institutional building construction – including university buildings, government buildings, and hospitals - which was down 7.4% year-over-year.
