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Favourable first quarter for non-residential investment in the Quebec City region

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Highlights

  • According to Statistics Canada, non-residential investment rose by 7.5% in the Quebec City census metropolitan area (CMA) in the first quarter of 2014, reaching a total of $301.6 million.
  • The Quebec City region topped the $300 million mark for the third quarter in a row and recorded the highest annual growth rate in this regard in the province of Quebec.
  • Investors’ interest in Quebec City was also reflected in the value of building permits, which rose by 26% during the quarter to $429.1 million.
  • The projects submitted boosted the value of both residential (+31%) and non-residential building permits (+15.3%).

Commentary

Compared with the same period in 2013, non-residential investment increased by 7.5% in the Quebec City CMA in the first quarter of 2014, reaching a total of $301.6 million. This was the highest increase in the province of Quebec and means that the region has topped the $300 million mark for three consecutive quarters.

The commercial sector was the most active, accounting for 77% of total investments and growing at an annual rate of 8.6%. Retail stores and restaurants continue to be incorporated into residential and office projects as the Carrefour Saint-Romuald begins to take shape. In the institutional market, capital spending grew by 12.5%, accounting for 16% of the first-quarter total. Several major projects are already underway (multi-purpose amphitheatre, Quebec City’s fine arts museum, airport, etc.), while others will be brought in gradually, such as the construction of computer data centres, the expansion of the Lévis trade and convention centre and the addition of office space in D’Estimauville. Meanwhile, industrial investment was lacklustre, falling by 11.2%. However, manufacturers are well aware that increased competitiveness depends in part on increased capital spending.

Serving as a barometer, the 15.3% increase in the value of non-residential building permits in the first quarter of 2014 (+26% overall) suggests that this pace will be maintained on worksites across the Quebec City region in the coming months. According to data compiled by Quebec International, the metropolitan region has some 170 non-residential investment projects that are either underway or have been announced; their potential value is estimated at over $6 billion.

Louis Gagnon
Senior Economist
Quebec International

 
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LouisGagnonSenior Economist

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