Canadian Nonresidential Construction Investment Down 3.2% in 1Q - Modern Distribution Management

Canadian Nonresidential Construction Investment Down 3.2% in 1Q

Quarterly decline due to lower spending on commercial buildings.

Canadian investment in nonresidential construction totaled C$12.5 billion (US$9.7 billion) in the first quarter, down 1.6 percent from the previous quarter and down 3.2 percent from the same quarter in 2015.

The quarterly decline reflected a decrease in investment on the construction of commercial buildings (down 1.8 percent) and industrial building construction (down 2.5 percent). Institutional investment edged down 0.9 percent.

Nationally, the decrease was a result of lower spending in all three components, with commercial buildings accounting for most of the decline. Non-residential building construction spending was down in eight provinces, with Alberta posting the largest decline and Quebec a distant second.

In Alberta, the decline came mainly from lower investment in commercial and industrial buildings, as spending on institutional buildings has been on an upward trend since the third quarter of 2014. In Quebec, lower spending on institutional and commercial buildings was responsible for the decrease.

British Columbia and Saskatchewan were the only two provinces to register advances. In British Columbia, the gain was a result of higher investment in commercial and industrial buildings. In Saskatchewan, the increase came from institutional structures and, to a lesser degree, commercial buildings.

Non-residential building construction spending fell in 22 of the 34 census metropolitan areas in the first quarter, led by Edmonton, followed by Montréal, Winnipeg and Calgary.

In Edmonton, the decrease was attributable to lower construction spending on commercial and industrial buildings. In Montréal, lower investment in institutional building construction was largely responsible for the decline.

The decline in Winnipeg resulted from lower spending on institutional and commercial buildings. In Calgary, the drop was attributable to decreased investment in commercial buildings, which was partly offset by higher investment in institutional buildings and, to a lesser extent, industrial buildings.

Conversely, the largest gains occurred in Saskatoon and Vancouver. In Saskatoon, the advance came largely from higher investment in the institutional component, while in Vancouver, the increase stemmed from all three components, with commercial buildings accounting for much of the gain.

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