Amid a steep decline in residential construction here, commercial projects are continuing to hold up overall building-permit values in parts of Spokane County, especially in Spokane Valley, where total building-permit values this year through July are up by more than a third.


Spokanes Valleys 2008 permit values through July totaled $117.4 million, up a whopping 36 percent from $86.4 million during the first seven months of 2007. The city of Spokanes total permit values through July were $178 million, up 1.3 percent from the year-earlier period. The permit values for unincorporated Spokane County totaled $137.7 million, down 5.4 percent from a year earlier.


The largest project Spokane Valley has permitted so far this year is the 265,000-square-foot office building and parking structure that Worthy Enterprises LLC, of Spokane, is building at 16202 E. Indiana. That projects value of $19.4 million accounts for more than half of this years increase in building-permit values in Spokane Valley.


Walt Worthy, who heads Worthy Enterprises, says hes building the project on pure speculation, but thinks Spokane Valley is ripe for continued commercial development.


Thats a lot of space to fill but Ive had quite a few inquiries, he says, adding, Between the Valley and Liberty Lake, that area is going to grow faster than anywhere in the county.


Other large projects permitted recently in Spokane Valley include the $11.4 million Granite Pointe apartment complex, to be built at 12707 E. Mansfield by HAL Valley Apartments LLC, of Spokane, and a $7.2 million self-storage complex to be built by Spokane developer Lanzce Douglass, at 11018 E. Sprague.


Mike Turbak, permit specialist for the city of Spokane Valley, says the city is benefitting from having an abundance of vacant land zoned for commercial uses.


Turbak, however, is reluctant to predict whether the increased permit values so far this year are a blip on the radar screen because of a few large projects or part of an ongoing trend.


He says, though, that several big projects are still in the early stages of the planning pipeline.


They could come through one per month, or they could come all in one month, Turpak says.


Two such projects include the planned $6.2 million renovation of the former HomeBase Inc. building for a WinCo Foods Inc. outlet, at 9718 E. Sprague, and a 106-room Hampton Inn Hotel with an estimated value of $11 million planned on the south side of Indiana Avenue, across from Worthys office-building project.


The city of Spokanes building-permit values were bolstered by strong numbers posted in May and June, with values totaling $58.2 million for the two months combined, up 29 percent from May and June 2007.


Sean Shields, the citys permit coordinator, says projected commercial permit values for 2008 are $217 million, which would be second only to 2006, when commercial permit values totaled $281 million.


Although the Spokane building department hasnt seen new projects with values on the scale of the Davenport Tower and Shadle Park and Rogers high schools projects that were permitted in recent years, it has handled a greater number of smaller multimillion-dollar projects, Shields says. Such projects include the $12.6 million YMCA-YWCA, facility, at 930 N. Monroe, and the $9.1 million Spokane Eye Clinic PS building, at 427 S. Bernard.


Kate McCaslin, president and CEO of the Inland Pacific Chapter of Associated Builders & Contractors, says commercial contractors in the Inland Northwest are keeping up a backlog of work.


Our plan room is exceptionally busy, McCaslin says. Its a bit of a surprise. Normally by this time, when we see a slowdown in residential construction, we would have seen commercial construction follow.


She says, though, that contractors profit margins have been narrowing this year, which could mean contractors are having to be more competitive with their bids.


Were hoping residential (construction) comes back, but at least its not all down, McCaslin says.


Diamond Rock Construction Inc., a Spokane Valley housing developer, is keeping busy in Spokane Valley, says Dennis Crapo, owner of the company. The developers active projects there are valued at more than $8 million, including a 26-unit apartment complex recently permitted at 18517 E. Boone, and ongoing construction at its 28-unit Ponderosa duplex project at the southeast corner of Schaffer and Dishman-Mica roads.


Theres still a demand for affordable housing and rental property, and those are two needs were trying to fill, he says.


Crapo, however, says hes still wary that the housing slowdown may get worse before it gets better.


Collectively, building-permit values for single-family homes in Spokane Valley, the city of Spokane, and Spokane County were down 42 percent in the first seven months of the year, compared with the year-earlier period.


Condron Construction Inc., a prominent Spokane home builder, is building 52 units this year, compared with about 80 homes at this time last year, says Craig Roberts, Condrons office manager.


Were just hanging on and trying to ride out the storm, Roberts says.


He says hes optimistic the market will pick up by next spring, especially for builders of homes in the $160,000 to $190,000 range, which appeal to first-time buyers.


Buyers are still looking, he says. Because of the inventory and selection thats out there, buyers have more time to look for better deals. Realtors are seeing people come back from last year who havent made a decision.


Contact Mike McLean at (509) 344-1266 or via e-mail at [email protected].