![The Daily](/web/20061201053507im_/http://www.statcan.ca/english/dai-quo/SSI/dailylogo.gif)
Thursday, October 12, 2006
Investment in non-residential building construction
Heavy spending on office buildings in Alberta and Ontario pushed investment in non-residential building construction to another record high between July and September.
Investment hit $8.9 billion, up 1.9% from the second quarter, the 14th consecutive quarterly increase.
![right click the chart to save it.](/web/20061201053507im_/http://www.statcan.ca/Daily/English/061012/c061012a.gif)
Investment reached record highs in two of three components — commercial and institutional. Investors pumped $5.1 billion into commercial projects, up 4.0% from the second quarter. In the institutional component, investment edged up 0.7% to $2.4 billion.
Note to readersUnless otherwise stated, this release presents seasonally adjusted data, which ease comparisons by removing the effects of seasonal variations. Investments in non-residential building construction exclude engineering construction. This series is based on the Building Permits Survey of municipalities, which collects information on construction intentions. Work put-in-place patterns are assigned to each type of structure (industrial, commercial and institutional). These work patterns are used to distribute the value of building permits according to project length. Work put-in-place patterns differ according to the value of the construction project; a project worth several million dollars will usually take longer to complete than will a project of a few hundred thousand dollars. Additional data from the Capital and Repair Expenditures Surveys are used to create this investment series. Investment in non-residential building data is benchmarked to Statistics Canada's System of National Accounts of non-residential building investment series. For the purpose of the Investment in non-residential building construction release, the census metropolitan area of Ottawa–Gatineau is divided into two areas: Ottawa–Gatineau (Que. part) and Ottawa–Gatineau (Ont. part). |
Spending in the industrial component declined 3.5% to $1.4 billion.
Provincially, the biggest third-quarter increase (in dollars) occurred by far in Alberta where investment rose 7.0% to $1.7 billion, a ninth straight quarterly gain. In British Columbia, which was a distant second, investment increased 2.6% to $1.3 billion.
In contrast, Ontario and New Brunswick posted the biggest declines.
Western Canada's dynamic economy continued to spark the non-residential sector. Other contributing factors included a strong labour market, strong consumer demand for durable goods and declining vacancy rates in large urban centres, which provided added incentive for office building construction.
Locally, 19 of the 28 census metropolitan areas recorded gains, with the strongest in Calgary, where investment rose 13.8% to $689 million. Fuelled by drops in all three components, Edmonton ended the third quarter with the most significant decline.
In constant dollars, investment in non-residential building construction declined 1.1% from the second quarter.
Commercial: Robust office activity in Alberta and Ontario
Investment in commercial building construction increased for the 12th quarter in a row, in the wake of robust activity in office building construction sites in Alberta and Ontario.
Overall, seven provinces and three territories showed increases in commercial investment in the third quarter. The largest contributions (in dollars) occurred in Alberta (+6.7% to $1.0 billion) and in Ontario (+3.3% to $1.9 billion), both all-time highs.
After four consecutive quarterly increases, Manitoba recorded the most significant decline in the wake of a downturn in investment in warehouses, shopping centres and recreational building.
Investment in non-residential building construction, by census metropolitan area1 | ||||||
---|---|---|---|---|---|---|
Third quarter 2005 | Second quarter 2006 | Third quarter 2006 | Second to third quarter 2006 | |||
Seasonally adjusted | ||||||
St. John's | ||||||
Halifax | ||||||
Saint John | ||||||
Saguenay | ||||||
Québec | ||||||
Sherbrooke | ||||||
Trois-Rivières | ||||||
Montréal | ||||||
Ottawa–Gatineau, Ontario/Quebec | ||||||
Ottawa–Gatineau (Que. part) | ||||||
Ottawa–Gatineau (Ont. part) | ||||||
Kingston | ||||||
Oshawa | ||||||
Toronto | ||||||
Hamilton | ||||||
St. Catharines–Niagara | ||||||
Kitchener | ||||||
London | ||||||
Windsor | ||||||
Greater Sudbury / Grand Sudbury | ||||||
Thunder Bay | ||||||
Winnipeg | ||||||
Regina | ||||||
Saskatoon | ||||||
Calgary | ||||||
Edmonton | ||||||
Abbotsford | ||||||
Vancouver | ||||||
Victoria | ||||||
|
Following a decline in the second quarter, Toronto recorded the biggest growth in investment in commercial buildings construction compared to the other metropolitan areas. In contrast, St. John's experienced the largest decline.
In addition to the decline in vacancy rates in the major urban centres, growth in retail and wholesale trade appears to have had a favourable impact on the construction of shopping centres, which posted a new record high.
Institutional: New record thanks to gains in educational building
Spending in the institutional component rebounded to a record high after a second-quarter decline. Strong investments in educational building in eight provinces more than offset a drop in the majority of other institutional categories.
![right click the chart to save it.](/web/20061201053507im_/http://www.statcan.ca/Daily/English/061012/c061012b.gif)
Alberta experienced the largest investment growth for a sixth consecutive quarter, as a result of significant spending on the construction of educational and health care facilities. Investment rose 4.4% to $349 million.
Ontario recorded the most significant decline in dollars (-2.3% to $996 million), in the wake of a downturn in investment in health care facilities following five consecutive quarterly gains.
Among metropolitan areas, Calgary posted growth in the third quarter, with investments rising 13.1% to $154 million. The gain was driven by substantial investments in health care facilities.
In Toronto, which experienced the most significant decline in dollars (-10.3%), third-quarter institutional building investment fell to $368 million. Toronto recorded a drop in every category of institutional construction.
![right click the chart to save it.](/web/20061201053507im_/http://www.statcan.ca/Daily/English/061012/c061012c.gif)
Of the 28 census metropolitan areas, 18 posted increases.
Industrial: Second consecutive quarterly decline
Investment in industrial construction fell 3.5%, as a result of a drop in the construction of manufacturing, processing and assembly plants. Even so, the $1.4 billion total was 7.8% higher than the average quarterly level recorded in 2005.
Third-quarter investment in industrial construction fell in seven provinces. The largest quarterly decrease (in dollars) occurred in Ontario (-11.2% to $432 million).
In contrast, Alberta, Manitoba and Saskatchewan showed increases in industrial construction investment, largely explained by more construction in maintenance buildings.
Overall, 12 census metropolitan areas recorded gains in investment. Calgary recorded the largest increase in industrial construction spending, which hit $67 million. Toronto posted the largest reduction.
Canadian manufacturers continued to face increased production costs, vigorous global competition and a strong Canadian dollar. Also, the industrial capacity utilization rate declined in the manufacturing sector for third straight quarter.
Investment in non-residential building construction | ||||
---|---|---|---|---|
Third quarter 2005 | Second quarter 2006 | Third quarter 2006 | Second to third quarter 2006 | |
Seasonally adjusted | ||||
Canada | ||||
Newfoundland and Labrador | ||||
Prince Edward Island | ||||
Nova Scotia | ||||
New Brunswick | ||||
Quebec | ||||
Ontario | ||||
Manitoba | ||||
Saskatchewan | ||||
Alberta | ||||
British Columbia | ||||
Yukon | ||||
Northwest Territories | ||||
Nunavut |
Available on CANSIM: table 026-0016.
Definitions, data sources and methods: survey number 5014.
More detailed data on investment in non-residential building construction are also available in free tables online. From the Summary tables module, choose Subject, then Construction.
For more information, or to enquire about the concepts, methods or data quality of this release, Bechir Oueriemmi (613-951-1165; bdp_information@statcan.ca), Investment and Capital Stock Division.
Navigation and search
Note: This page contains several navigation menus. To enhance accessibility, most of these menus and the site search box are grouped in this section.
To find out more about accessibility features on our site, read our accessibility page.