Despite the COVID-19 pandemic, billions of dollars in residential construction and major infrastructure projects are underway or proposed for the Thompson-Okanagan region in the southern interior of B.C.
A total of 55 projects worth $13 billion are under construction and another 39 projects valued at $4.4 billion are proposed, according to a report called BC Check-up 2021 released by the Chartered Professional Accountants of British Columbia that looked at major building activity in regions across the province.
The projects include highway bridges, hydroelectric projects and a number of massive new residential housing developments.
“While the Thompson-Okanagan region has not been immune to the impacts of the COVID-19 pandemic, it has experienced a strong economic recovery since the summer of 2020 and has fared slightly better than the province overall,” says Karen Christiansen, a partner at MNP LLP in Kelowna.
“The Thompson-Okanagan is on a strong path to return to pre-pandemic economic activity. While there will be challenges ahead, the sizeable private and public investment in major projects in the region should boost the region’s recovery.”
The largest project underway is the $2.1 billion Wilden Development, a master-planned community of single-family and townhome neighbourhoods near Kelowna. The development features energy-efficient and sustainable homes in an area of wetlands and natural space.
Another large project is the New Monaco, a 125-acre, $1-billion, mixed-use master-planned community being developed in the northeast corner of Peachland overlooking Lake Okanagan. The project is divided into three distinct neighbourhoods and will have commercial services and a shopping, entertainment and recreational complex, along with restaurants, a hotel and convention centre.
The development will have 255,000 square feet of retail space and 2,800 housing units. The project has been adopted into Peachland’s Official Plan and the developer is aiming to begin construction this year.
The Shelter Bay residential neighbourhood, a large master-planned community carved out of a 5,200-acre patch of forest next to Upper Arrow Lake on Westbank First Nation land south of Revelstoke is another $1-billion residential project slated to begin this year. The developer is negotiating with Westbank First Nation for a 125-year lease that will allow up to 1,500 condos, highrise towers and a marina to be built.
“The Thompson-Okanagan real estate market has picked up steam in recent months and has set the foundation for 2021 to be a good year for the construction industry,” notes Christiansen. “Smaller residential projects should be buoyed by the strong demand seen, and major project activity expected to begin in 2021 will also provide a boost the region.”
According to the Check-up report, housing starts in the Thompson-Okanagan dipped in 2020 from strong levels in 2018 and 2019. However, they rebounded as the year progressed and construction activity remained high.
“The residential real estate market was very hot to close out 2020 and that momentum has continued into 2021,” explains Christiansen.
Another significant residential project for Kelowna is a nine-building, 200-unit townhome development at the Hiawatha RV Park that is expected to get underway this summer. Kelowna town council has given the green light to the first phase of the project, nine three-and-a-half storey townhouse buildings.
On the infrastructure side, a number of projects are proposed, including a $225-million replacement of the R.W. Bruhn Bridge on Highway 1 near Sicamous. The project, currently in the detailed design phase, will include four-laning 1.9 kilometres of the highway and intersection improvements between Old Sicamous and Silver Sands roads.
The value of major projects in the Thompson-Okanagan did decline in the third quarter of 2020 to $19.4 billion, from $20.5 billion the year before, but the overall value of the region’s major projects was still high.
Overall, the dollar value of projects under construction in the Thompson-Okanagan in the fourth quarter of 2020 was down by 9.1 per cent compared to the same quarter in 2019. That was due in large part to completion of the $1-billion Rise Resort and Residential Development in the first quarter of 2019.
“While a decline, the region’s still seeing strong major project activity and several projects are expected to begin construction in 2021,” says Christiansen.
For proposed major projects in the region, the dollar value in the fourth quarter of 2020 also declined by 3.7 per cent from the same quarter in 2019. However, that does not appear to reflect true future plans.
“Major projects generally have quite a long path from proposal to starting construction, including consultations, regulatory approvals, and tendering the project,” says Christiansen. “The hold-up on the projects is nothing out of the ordinary for the region, and the expectation is many of these proposed projects will begin construction over the next two years.”
Six projects in the region worth $1.3 billion are currently on hold. They were paused prior to the COVID-19 pandemic for a variety of reasons.
The largest is the proposal for a mine 90 kilometres north east of Kamloops. The owner, Harper Creek Mining, is waiting on market conditions to improve before continuing with a proposal to build and operate the open-pit mine. The $839-million project would produce 25 million tons of copper, gold and silver ore per year.