Essential Workers
When it comes to the COVID-19 Pandemic, very few things have gone as expected and the construction scene in Philadelphia is no different. Like most large cities across the nation, construction projects ground to a halt in March 2020 as businesses waited for guidance on if and how they could return to work safely. However, the need for continued road and building maintenance, as well as the potential need for construction of new medical facilities, made construction personnel some of the first to be considered essential workers. By August 2020, new construction permits in Philadelphia were at record levels and the work has continued ever since.
Booming Construction
This stream of construction projects has held steady in Philadelphia for many reasons. First, many projects had already been planned and financed, and the halt during the early months of the pandemic created a bottleneck. So it makes sense that when workers were allowed to return to their projects, they made up for lost time.
Rushing Permits
Secondly, Philadelphia’s 10-year tax abatement rule on new construction was originally set to expire in early 2021 (it has since been delayed until 2022). Since the rule is based on when the permit was purchased and not on the groundbreaking of a project, many businesses bought permits preemptively to avoid any extra taxes. This secured several projects that may have been put off and helped continue the trend of increased construction in the city and surrounding areas.
Surging Markets
Another significant factor in the increased rates of construction around Philadelphia was the surging housing market. As interest rates dropped and many searched for larger homes to accommodate their new work-from-home lifestyle, construction bloomed. Since many workplaces went completely remote, many of those working outside Philadelphia are now able to truly call the city home.
Finally, institutional development around Philadelphia soared, bringing with it several new, large-scale construction projects. An increase in hospital and educational needs lead to expansion in the Navy Yard and University City, and thanks to the massive increase in online shopping, warehouse and other storage buildings also demanded construction and repair.
The Future of Philly Construction
As we start to see a decrease in COVID cases and life regains some pre-pandemic feeling, will construction continue? While nothing is certain, there are no shortage of projects on the horizon. In December 2020, the Philadelphia City Council passed Philadelphia’s first residential development impact tax, meant to send millions towards new, affordable housing projects. With many companies planning on staying remote, a conversion of office buildings to apartments, hotels, and other businesses can also be expected.
No matter what happens, Steadfast will be there to meet all of your construction needs, and we look forward to watching Philly’s construction continue to thrive.