While some aspects of the Whatcom County economy appeared to be getting back on track in 2011, construction continued to struggle.
An analysis of the Whatcom, Bellingham and Ferndale building permits showed several trends as well as a common theme: Investment in new projects remained quite sluggish last year, in some cases the slowest in many years.
This coming year doesn't appear to point toward a significant uptick in new projects, except possibly in apartments and multifamily residential, which currently have low vacancy rates.
"We're still in a period of shoring up and absorbing (vacant spaces)," said Troy Muljat of The Muljat Group, referring to business projects like retail, industrial and office buildings. "People are renovating existing spaces, and that won't change until the absorption hits a level where there is rent growth."
The lagging construction industry also has meant fewer jobs locally: In Whatcom County, the number of people employed in construction peaked at 6,000, according to the Washington State Employment Security Department. In 2006, local construction jobs peaked at 8,600.
Here's a breakdown on what happened in building activity last year:
Bellingham: The value of projects issued permits last year totaled $100.4 million, the lowest total since 1998. The peak year in Bellingham came in 2003, when the value of projects totaled $218 million.
In terms of valuation, the most popular Bellingham permit was in the commercial alteration category, which had projects totaling $43 million. Instead of constructing new commercial, industrial or office structures, much more work went into revamping existing, vacant buildings. An example of this was national retailer Marshalls, which went into a vacant spot in Meridian Village after extensive renovation work.
"The empty stores are starting to get filled, so at least there's remodeling work taking place," said Steve Isenhart, co-owner of Tiger Construction in Everson. "We're starting to see some new commercial work as a result."
Unincorporated Whatcom County: Total valuation of issued permits was $142.4 million last year, spiking 22 percent compared to the previous year. A big chunk of that came from two projects: $65.3 million for the BP Cherry Point work that started last spring and $25.2 million for the Meridian High School renovation work. The number of permits issued in 2011 was 739, down 22 percent compared to 2010.
Ferndale: This community was one of the few bright spots for construction activity last year, with valuation totaling $28.9 million, the best since 2008. Much of Ferndale's growth came from single family homes: The community issued permits for 89 new homes, a 61.8 percent increase compared to 2010.
Ferndale issued more permits for single family homes than Bellingham, which issued 73 permits last year.
Muljat said one factor for Ferndale's growth in building new homes is cost.
"Supplies and labor are the same, so the difference (between Bellingham and Ferndale) is land costs and permit fees," Muljat said.
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