Builders flex: 2006 was a huge year
January 10, 2007
Park City’s construction industry, flexing as the city enjoys a buzzing real-estate market, posted unprecedented numbers in 2006, powering well past its previous benchmark.
The Park City Building Department reports that the bellwether sector compiled almost $173.3 million in construction in 2006, a record amount for the city. The previous year, the department handled about $115.5 million.
The 2006 sum beat the previous record, about $118.9 million in 1999, by roughly 46 percent, a staggering difference between the record years. The record was beaten in August and builders had been tacking onto the total since then. The Building Department released the final figures for 2006 late last week.
"I think (the community) felt it. There’s a lot of activity around town people see," Ron Ivie, the city’s chief building official, says about the impact on Parkites.
Ivie credits a few larger projects for boosting the numbers and says lots of construction in Old Town also pushed them higher. The most valuable projects, he says, were the Grand Lodge at Empire Pass, on the slopes of Deer Valley Resort, and Silver Star, situated slopeside at Park City Mountain Resort.
He says lots of houses went up in 2006 and people remodeled others, adding to the numbers.
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According to the department’s end-of-year report, 122 houses were built in 2006, valued at about $59 million combined. The numbers were well ahead of the previous two years, 84 houses in 2005 and 97 in 2004. The value of the houses in 2006 beat the previous two years.
Ivie says Old Town was an especially busy neighborhood for house builders but precise numbers for the area were not immediately available.
"There’s been a lot more activity in Old Town than we had in most years, at least in the recent past," he says.
Dick Peek is among the builders putting up houses in the neighborhood in 2006, working on two at the intersection of 10th Street and Woodside Avenue. Peek, who received the permits for the houses the year before, says buyers see Old Town as a convenient place for a house.
"I think it’s the proximity to skiing, bus service. All the city infrastructure is right here," Peek says. "I think people realize that."
Peek expects to finish the two houses within two months. They are each on the market for more than $2 million.
"The level of what’s being constructed is phenomenal," he says. "It’s almost every block you go down there is a project on it and it hasn’t been like that in the past, not as noticeable."
The city’s real-estate market is enjoying a post-Winter Olympics boom and realtors say buyers in the last few years have been more interested in Park City. They say that the buyers see Park City as a better deal than other mountain towns like Aspen, Colo., Jackson, Wyo., and Sun Valley, Idaho.
In October, Betty Brown, the president of the Park City Board of Realtors, said Park City was "undervalued" compared to the other mountain resorts as she explained the related construction and real-estate booms.
Some details from the Building Department’s report include:
( The department in 2006 issued 1,185 building permits, up from the 1,057 in 2005 and the 1,015 in 2004.
( The department collected a little more than $5.6 million in fees, up from the previous two years, $3.6 million in 2005 and a little less than $3.5 million in 2004.
( Five commercial buildings received permits in 2006, the most in three years, and four industrial buildings received permits, also tops in three years.
( The number of relocations and demolitions was the highest in three years and the department allowed the highest number of alterations or additions to dwellings in three years. Alterations and additions to commercial properties dipped from 2005 and 2004, though.
Ivie says he did not anticipate the numbers in 2006, acknowledging that he predicted that the industry would be slightly ahead of 2005.
"It’s staggering to try to staff it and keep it together," he says.
Ivie predicts the industry in 2007 will approach last year’s record, depending on whether the Montage, an upscale project in Empire Pass, receives its permits during the year. City Hall this week is expected to consider the Montage proposal.
Rory Murphy, the Silver Star developer, says the real-estate market influenced his project’s construction schedule. He says each of the approximately 100 units at Silver Star was sold before the construction crews broke ground.
"We were very fortunate with our sales," Murphy says. "We would have phased our construction differently if we hadn’t sold everything out."