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Builders say a number of factors are presenting challenges for those building projects in the Fargo-Moorhead area, including wet conditions this summer. Rains have made progress difficult for this school project in West Fargo. Dave Olson / The Forum

Building boom: Fargo building permit values bury record, but weather impedes some work in area

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Fargo - As of Monday, the number of building permits issued by the city of Fargo so far this year stood at 1,213, seven permits more than were issued during the same period in 2013.

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But that’s where the similarities end.

The total value of projects permitted so far this year is about $472 million, far beyond the total value of projects permitted during all of 2013 – about $377 million – which until now was a record.

And based on the value of construction work waiting for permit review, the total value of projects in 2014 may surpass $850 million, according to Ron Strand, head of inspections for the city of Fargo, who said that in most years the total value on projects runs about $300 million.

One category leading the value explosion this year is new commercial construction.

In the first half of 2013, 26 permits were issued in that category in Fargo, with the projects valued at about $26 million.

So far this year, 31 permits have been issued for projects valued at close to $194 million.

“That speaks to the size of the projects,” Strand said, adding that work on Sanford Health’s new medical center is a factor in this year’s skyrocketing permit values

Construction barriers

Meanwhile, a number of factors, including rainy conditions and labor shortages, have stymied progress on some projects in the Fargo-Moorhead area.

Wet weather has been a major hindrance for Lee Jones & Son Construction, which is building an elementary school in West Fargo.

“It’s a struggle to get to the site,” Tim Jones, company president, said, referring to muddy conditions workers have faced trying to get machinery to where it needs to go.

“Today, we were pouring (concrete) in between rainstorms,” Jones said, adding that because of all the rain and the fact the frost took longer than usual to leave the ground, many contractors figure they’ve lost four to six weeks of their construction season.

For some projects, lack of qualified workers has slowed things down, according to Mark Housh, head of inspections for the city of West Fargo, where the number of permits issued for commercial construction through the first five months of the year jumped from seven in early 2013 to 20 this year.

Total valuations for those commercial projects went from $3.4 million in early 2013 to $26 million so far this year.

Overall, Housh said, the value of all building permits so far this year totals about $139 million, compared to about $82 million for the same period last year. At that pace, he said, West Fargo could set a record for total building permit valuation this year.

The record, about $216 million, was set in 2012, the year Costco and other large projects received permits.

Permits up, values down

The city of Moorhead is experiencing an uptick in the number of building permits issued this year compared to last year, but the overall value of projects this year, about $27 million, is lower compared to the same period last year, when project values totaled about $41 million.

Matt Maslowski, economic development director for the city of Moorhead, said that is likely due to several large projects permitted last year, including a Sanford Health facility and a Sam’s Club.

Meanwhile, labor shortages have been reported in connection with certain construction projects in Moorhead, according to Maslowski.

“We are primarily experiencing rafter and truss delays with construction and that is expected to continue to rise as the season progresses,” he said.

“The good news is this signifies a clear pattern year over year in increased new construction and redevelopment in Moorhead,” Maslowski added.

Strand said demand for workers in North Dakota’s Oil Patch may contribute to whatever labor shortages are occurring in the Fargo-Moorhead area.

He said that same labor demand may be fueling some of Fargo’s construction growth, as oil workers look for places to live.

“Fargo is not that long a commute for the weekends. We’re picking up housing as a result of that.”

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Dave Olson
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