Phase 1 of the Ariva construction project in West Kelowna, B.C., was recently completed but the 38-unit luxury condo building took a lot longer to finish than anticipated.
“Typical multi-family would take maybe 15, 17 months, so we’re double that,” said developer Kevin Johnson with Ariva Resorts.
While there were a variety of contributing factors, including the COVID-19 pandemic and supply chain problems, a shortage of workers also led to delays.
“A lot of labour, labour problems and challenges,” Johnson said. “Challenges of getting people here in the Okanagan who can do big projects like this.”
The labour shortage is so significant, it has impacted Phase 2 of what will eventually be a five-phase project.
“We are in our Phase 2, which got started and we had to put a hold on things,” Johnson told Global News.
Fewer workers means higher construction costs so despite having started building Phase 2, work on the project had to stop for now.
“We were going to be experiencing at least a 15 per cent increase in cost; we actually said 10 to 15,, and then when we ran all the numbers, we were more like 30 or 40 per cent higher and so we had to kind of put a pause on things,” Johnson said. “And we had to return deposits and had some difficult conversations with all the purchasers and some people were really bummed out.”
Construction projects in the Okanagan can’t be completed fast enough as the province deals with a housing crisis but those in the industry say it’s the labour crisis that needs to be addressed first.
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“Everybody’s talking about the housing affordability crisis and just the housing building crisis, but the underbelly of all of that, that really nobody is talking about ahead of the affordability crisis, is the labour shortage,” said Charlene Thomas, executive director at the Okanagan chapter of the Urban Development Institute (UDI).
While it applauds governments cutting red tape to speed up construction, the UDI said those fast-tracking measures don’t address what is a bigger problem.
“Once all this red tape is going to be mitigated etc., and all the different policies and legislation that the province is bringing in … we’re going to be able to build it faster, but who’s building it? Who is going to build it?” Thomas asked.
Earlier in the year, the province implemented the Housing Supply Act, which gives the province the ability to set housing targets in municipalities to encourage them to address local barriers to construction so that housing can be built faster.
This includes updating zoning bylaws and streamlining development approval processes.
“There’s a lot of news that’s coming out from the province and big announcements and stuff like that, and that’s to help speed up or encourage municipalities to reduce approval times and that’s all really good stuff but I think that what we’re missing is that we need people to build all these, all these projects and all this housing,” Johnson said.
“There’s only so many drywallers in town, there’s only so many electricians, there’s only so many, HVAC installers, and so we need to boost our labour force in order to achieve all this progress.”
Johnson said that’s especially important in a rapidly growing region like the Okanagan, where innovative government and industry solutions are desperately needed.
“I think that there needs to be maybe a shift in the paradigm that says we’ve got to treat workers better and provide a better work environment for them,” Johnson said. “And these are things that we’re going to need to do as an industry to attract and retain people.”
Until that happens, though, the wait for new housing will far outlast the speed of construction.
“Things will progress and keep moving forward, but they will be so much slower than what we would all like and what we all need,” Thomas said.
According to the B.C. Construction Association, up to 40 per cent of workers in the construction industry will be up for retirement in the next decade.
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