By NEIL HARTNELL
Tribune Business Editor
The Bahamian Contractors Association’s (BCA) president yesterday expressed hope that the construction industry may have passed “the darkest hour of the night”, acknowledging that his own firm had not seen “a contract of significant value” for more than two years.
Godfrey Forbes expressed hope that a Department of Statistics report on the sector, which showed new construction permits issued in the 2013 second quarter, were down year-over-year by 30 per cent and 34 per cent, in terms of number and value respectively, symbolised the hour “just before dawn”.
Showing just how deeply the Bahamian construction industry was affected by the recession, and its ongoing struggles to recover, the Department of Statistics report said: “During that quarter, 335 permits were issued with a total value of approximately $83 million.
“This number and its accompanying value were lower than that recorded during the same period in 2012; the number decreased by 30 per cent and the value by 34 per cent.”
These are the latest available statistics for the construction industry, and Mr Forbes said: “When you look at that, you see we’re not going in the right direction. We’re not going up; we’re going down. It does not reflect a positive direction with what’s happening for us in the industry at this point.”
Trying to strike a positive note, Mr Forbes said the statistics might indicate that the industry was “bottoming out”, and may be on the verge of “bouncing back”.
The data contained in the Department of Statistics report was less negative when it came to construction starts, saying these fell only 18 per cent year-over-year - from 106 in the 2012 second quarter to 87 in 2013. The value of such starts was down just 7 per cent, from $25 million to $23 million year-over-year.
Mr Forbes said his own business, Dykton Mechanical, was now bidding on more projects, “an indication that things are moving now”.
However, he questioned whether there would be sufficient work to go around for the hundreds of Bahamian contractors who had been starved of business during the recession.
“We are looking at a little something now - less than $100,000,” Mr Forbes said of his own business, although this was the first contract to appear in 10 months.
“I’m trying to go ahead and price some stuff, but am still trying for new contracts,” he told Tribune Business. “I haven’t seen a contract since July last year, and that was for one of the dormitories at the Detention Centre, so that was no work for me.
“I haven’t had anything of significant value for close to almost two years,” Mr Forbes added. “Significant value, for me, is something in the vicinity of $500,000. It’s been over two years since I’ve seen anything like that.
“The industry continues to struggle at this point, and still being optimistic, maybe it’s at the point of the darkest hour of the night, just before dawn. Maybe things are about to break.”
The Department of Statistics said in a statement that, on construction permits, private/residential buildings accounted for more than 70 per cent of the total issued, and more than 60 per cent of the total value, in both the 2013 and 2012 second quarters.
“The annual data for the two latest years indicate that in 2012 the total number of construction permits issued, 1,916, was slightly lower (2 per cent) than the 2011 figure of 1,957,” the Department said.
“In contrast, there was a substantial decline (63 per cent) in the value of permits issued over this period, from approximately $2 billion in 2011 to $716 million a year later.”
It added: “In both years the permits in the commercial/industrial sector were the main contributors to the overall value, accounting for 79 per cent in 2011 and 52 per cent in 2012.
“The number of residential permits issued far exceeded that of any sector, accounting for 78 per cent in the earlier year and 75 per cent in the latter.”
As for construction starts, the Department added: “Data pertaining to the total value of the starts showed an increase for the private sector but a decrease for the commercial/industrial sector.
“The former increased from $20 million in the second quarter of 2012 to $21 million in the second quarter of 2013, while the latter decreased from $4.7 million to $2.9 million over the same period. There was no activity in the public sector during this period.
“The data for 2012, when compared to 2011, show that for all types of buildings there was a decline in both the number and value of construction starts. The number of private/residential starts fell by 107 units, with a decline in value of $7.4 million.
“The commercial/industrial sector was eight units short of the 2011 figure, while the value was $21 million less. The public sector recorded no starts in 2012.”
When it came to construction completions, the Department of Statistics said: “The number of buildings completed in the second quarter of 2013 versus the same period in 2012 declined by eight units, and increased in value by $9 million.
“In the private/residential sector there was a decline in number (146 versus 132), but in the commercial/industrial sector there was an increase from the 32 buildings in the earlier quarter to 38 in the latter.”
The report added: “In 2012, the total number of buildings completed, 807, was 53 less than the number recorded in 2011, representing a decline of 6 per cent.
“The value of these completions also decreased, from $500.6 million to $317 million, a decline of 37 per cent. The private/residential sector showed a decline of 75 units as well as a decline in value of $21.8 million. This sector accounted for 77 per cent of all completions in 2012 and 48 per cent of the value.
“The commercial/industrial sector experienced an increase in number and value, 23 units and $3 million, respectively. This group represented slightly less than a quarter of total completions and half of the value. In 2012, completions in the public sector was one unit less than the previous year, and the value was lower by $165 million.”