Once nearly lifeless, Park City’s construction industry posts a solid June | ParkRecord.com

Once nearly lifeless, Park City’s construction industry posts a solid June

Park City’s construction industry, nearly lifeless in the early part of 2010, posted a standout month in June, an indication that the bellwether sector could be poised for a stronger second half of the year.

The Building Department’s monthly activity report for June showed permits were issued for construction valued at just less than $7.1 million, by far the best month of the year. The value represents 42.7 percent of the year-to-date figure.

The June figure soared above the $3.6 million in permits issued in May, itself a solid month in the industry and the second-ranked month of the year. The number in June also beat the figure recorded in the same month the year before, more than doubling the $3.4 million that the Building Department authorized in June 2009.

"There’s increased activity when you compare June with May. There’s an obvious increase in activity," said Roger Evans, City Hall’s interim chief building official.

Permits for houses pushed up the numbers in June, with the Building Department indicating that four such permits were issued. They were worth a combined $3.9 million. The Building Department said the house sites are in Old Town, the Aerie, Empire Pass and Park Meadows. Developers also received a permit to build a duplex, pegged at $582,374.

Meanwhile, permits for alterations and additions were strong in June, with the Building Department issuing more than $2.5 million worth of permits between 107 projects, mostly involving residential properties.

Between the various categories, the Building Department issued 124 permits in June, up sharply from the 73 issued the month before and the 83 issued in the previous June.

"We’re seeing an increase, an uptick, in construction," Evans said, acknowledging, though, that it is not a "major, major spike."

But even a slight increase will be welcome in the construction industry, which suffered terribly in the recession and has yet to reignite. The year-to-date figure — $16.6 million — continues to trail far behind the numbers during the same period in 2009, when $45.6 million worth of construction was permitted.

The construction industry is one of the Park City economy’s most important sectors, providing City Hall a revenue stream from permitting fees and creating a large bloc of jobs. It also has trickle-down effects across a wide spectrum of businesses like restaurants, house cleaners and lawn services.

The Building Department in 2009 and 2010 has reported month after month of down numbers. Park City officials and people in the industry say lenders were especially tight during the worst of the recession and they continue to be stringent in their loans.

The tighter lending practices were instituted as Park City entered a period when development had been expected to start to trail off anyway. The number of major projects envisioned inside the city dwindled as prime land became more scarce.

In the years before the recession, the construction industry regularly posted record-setting years, with some pushing into the nine digits.

Evans said he anticipates the end-of-year numbers in 2010 will slightly outpace the $68.5 million tally of 2009. If that is to occur, the industry will need to increase its pace in the second half of the year. The end-of-year figure in 2009 was more than four times the midyear 2010 number.

"I think it’s just going to gradually increase," Evans said, adding, "We’ll see an improvement."

Jason Moore, the president of the Park City Area Home Builders Association and owner of the contracting firm Plumb Level Square, said he is aware of landowners who are ready to build but lack the financing. People need "an incredible amount of good credit" and capital to press forward with construction, he said.

He said a monthly pace of four house permits, like the total in June, would be solid if it continues.

"I wouldn’t expect much more than that," he said, adding, "If there’s four permits a month, I’d say that’d be pretty good."

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