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Construction sector shows signs of life

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Total building permits in the Nashville Metropolitan Statistical Area, which includes Murfreesboro, increased 22.3 percent from April 2011 to April 2012. (File photo)

Murfreesboro is abuzz with construction with several subdivisions, apartment complexes and restaurants currently or nearing being built.

But other communities aren’t so lucky, and new data suggests that the local construction economy is faring better than the rest of the nation.

Total building permits in Nashville Metropolitan Statistical Area, which includes Murfreesboro, increased 22.3 percent from April 2011 to April 2012, according to a report by MTSU’s Business and Economic Research Center with data provided by Bureau of Labor Statistics, Census Bureau and Tennessee Department of Revenue.

Statistics were seasonally adjusted by Economic Research Center.

Single-family home construction permits weren’t quite as lucky, with only an 8 percent year-over-year increase. Sales tax collections rose 11.6 percent over the same time period, the data shows.

“Is single-family home construction improving?” David Penn, director of the Econimic Research Center, asked in a report. “Perhaps, but it depends on where you are. Housing construction activity for Tennessee is trending lower, with lower activity also occurring in the Clarksville, Cleveland, and Nashville MSAs. Knoxville and Memphis MSAs are flat, while the trend is improving in Chattanooga, Jackson, Johnson City, Kingsport-Bristol, and Morristown MSAs.”

While construction may still lag behind early-2000 numbers, home sales continue trending upward, which could lead to a spur in construction if inventory gets low enough.

Year-over-year home sales in Davidson, Rutherford, Williamson and Wilson counties combined were up 35 percent in April, according to Steven Dotson, president of Rutherford County-based Red Realty.

Last month, he said the housing market has officially turned the corner, citing increased sales and a 12 percent decrease in inventory from April 2011 to April 2012.

“I’m sure we’ll still see all the seasonal trends up/down and we have a long ways to go to get to 2006 sales volumes, but these numbers above are all a great sign for a recovery over the next couple years,” Dotson stated in his April 2012 Red Report.  

Murfreesboro’s Planning Commission reviewed a final plat in mid-May for nine lots within Retreat at Marymont Springs and two site plans for two four-family dwellings along Benley Street and Macedonia Drive.

The Planning Commission also reviewed a preliminary plat for 34 lots along Chaminade Lane.

With each new subdivision comes construction, which brings along jobs to the area. The same is true for new and existing businesses looking to expand.

Aside from single-family activity, Murfreesboro has also witnessed a spur in general construction over the past several months. Agendas for the city’s planning and codes departments have shown consistent activity in new construction, expansions and build-outs.

Aside from Walmart and Amazon.com building mega-centers within the city limits, a range of restaurants are slated to join Murfreesboro, including an 8,600 square-foot Cheddars restaurant on Old Fort Parkway, Firehouse Subs near Walgreens on Medical Center Parkway and Taco Bell on Memorial Boulevard.

A 5,000 square-foot office and retail building was also proposed for South Rutherford Boulevard. And with two public hearings scheduled for Wednesday regarding an application to rezone parts of South Church Street and Memorial Boulevard to Commercial Highway, additional construction is potentially in Murfreesboro’s near future.

Middle Tennessee is faring better than other parts of the country, newly released data shows.

Construction employment declined in 157 out of 337 metropolitan areas between April 2011 and April 2012, increased in 120 and stayed level in 60, according to a new analysis of federal employment data released today by the Associated General Contractors of America. Association officials said that construction employment continues to suffer from relatively weak demand being driven largely by declines in public sector investments.

“As public investments in infrastructure and other forms of construction continue to decline, construction employment is taking a hit in many parts of the country,” said Ken Simonson, the association’s chief economist. “Even in places where construction employment is increasing, the figures would have been better if the public sector wasn’t holding things back.”

The largest job losses were in Chicago-Joliet-Naperville, Ill. (-6,500 jobs, -6 percent), followed by Tampa-St. Petersburg-Clearwater, Fla. (-6,200 jobs, -12 percent); St. Louis, Mo.-Ill. (-6,000 jobs, -9 percent); Atlanta-Sandy Springs-Marietta, Ga. (-5,400 jobs, -6 percent) and New Orleans-Metairie-Kenner, La. (-4,600 jobs, -14 percent). Anchorage, Alaska (-28 percent, -2,400 jobs) lost the highest percentage.

Fargo, N.D.-Minn. added the highest percentage of new construction jobs (27 percent, 1,600 jobs) followed by Bakersfield-Delano, Calif. (24 percent, 3,300 jobs) and Grand Forks, N.D.-Minn. (23 percent, 500 jobs). Indianapolis-Carmel, Ind. added the most jobs (6,100 jobs, 16 percent). Other areas adding a large number of jobs included Portland-Vancouver-Hillsboro, Ore.-Wash. (4,800 jobs, 11 percent); Seattle-Bellevue-Everett, Wash. (4,400 jobs, 7 percent); Phoenix-Mesa, Ariz. (4,400 jobs, 5 percent) and San Jose-Sunnyvale-Santa Clara, Calif. (3,500 jobs, 12 percent).

Association officials said one of the main reasons behind recent declines in public sector investments in construction was the fact that the reauthorization of a number of key federal infrastructure programs has been languishing for years. Fortunately, Congressional negotiators are reportedly close to finalizing a new surface transportation bill that would help support needed highway, bridge and transit improvements across the country.

“One of the best ways to boost the private sector and put construction workers back on the job is by investing in our aging infrastructure,” said Stephen E. Sandherr, the association’s chief executive officer. “Instead of undermining the construction industry’s recovery, Congress is just a few votes away from helping it.”

Read more from:
Business, Business and Economic Research Center, Construction, Department of Revenue, Economy, MTSU, Murfreesboro, Real Estate, Rutherford County
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