March 7, 2008 - NEWS RELEASE

BC's Construction Outlook Very Positive - BTY Group

Vancouver, B.C. – A new report released today by BTY Group shows that British Columbia’s construction outlook for 2008 is very positive. BTY Group forecasts that greater price stability in the provincial construction market will help maintain a healthy level of investment in both the public and private sectors of the industry.

“Although several major infrastructure projects are about to end and forestry is struggling, B.C.’s construction sector continues to be vibrant,” said Joe Rekab, Managing Partner of BTY Group. “Non-residential building construction should stay strong through 2009, while housing starts will be above the 10-year average.”

While construction costs continue to be at record high levels, the escalation rates in B.C. are stabilizing. BTY Group forecasts the following escalation rates through 2011:

Construction Cost Escalation – Selected Provinces      
    

   
“Better cost certainty in the construction sector is good news for everyone,” said Philip Hochstein, President of the Independent Contractors and Businesses Association (ICBA). “With moderating cost increases, we won’t have the price shocks that have characterized the construction sector in recent years. This allows us to provide our clients with solid cost estimates they can rely on. It means less risk for construction clients and more predictable prices for consumers.”

According to BTY Group, construction cost escalation is affected by a myriad of factors, including population growth, labour supply, the Canadian dollar value, the prime lending rate, and high oil prices.

“When looking across the country, B.C.’s cost escalation is forecast to be much more stable than the neighbouring provinces of Alberta and Saskatchewan,” said Rekab.

According to BTY Group, the positive outlook for the construction sector is due to a provincial economy that has been able to weather the economic storm in the United States. The report contributes this to:

• B.C.’s mining and oil and gas sectors continuing to show solid growth
• B.C. has the second fastest provincial population growth, with 48,600 new residents last year
• Ongoing infrastructure projects such as Sea to Sky Highway, Bennett and Pitt River Bridges, and major expansions at Kelowna, Vernon, Surrey Memorial and Royal Jubilee Hospitals
• Strong investment growth from Alberta in the southeast, Okanagan and Peace regions of B.C.

“The doom and gloom of south of the border is not happening in B.C., as cost increases suggest continued economic growth,” said Hochstein. “While we have challenges in the export sector, our domestic economy continues to be very resilient.”

Market Intelligence is available online.

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For more information, please contact:
Philip Hochstein, ICBA President
Office: 604.298.7795
Cell: 604.561.9402
Email: philip@icba.ca