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No slowdown seen in Nevada County construction industry despite COVID-19 lockdown

By the numbers

As of April 30

Number of COVID-19 cases in Nevada County: 41

Number in western county: 12

Number in eastern county: 29

Number of deaths: 1

Learn more at http://www.theunion.com/coronavirus

As Nevada County navigates its way through the sixth week of dealing with the shutdown over coronavirus concerns, there are a few bright spots on the economic horizon.

Chief among those is the construction industry, which has been able to continue an upswing from the recession years of 2008-2010.

The long-term nature of most development projects has worked in their favor, developers say. Large commercial projects that have been in the pipeline for years continue to move forward — and residential building permits are on the upswing countywide.

No pause button

Higgins Marketplace, which broke ground in September, has sustained a few delays but still is on track for a mid-July grand opening, said Katz Kirkpatrick Properties Principal Fred Katz.

The construction crews have been working six days a week and longer hours to offset some of the social distancing requirements, Katz said.

Leasing has been an issue, but one that is being felt statewide, he said. One prospective tenant in line to lease a 3,000-square-foot space has postponed making the commitment, Katz said, adding the center is 67% leased at this point, with tenants so far including Holiday Market, El Dorado Savings Bank and a nail salon. The most recent confirmed tenant is Culture Shock Yogurt.

“What we’re generally seeing on these projects, for the most part, especially the larger projects, those clients still want to go forward,” said Martin Wood of SCO Planning, Engineering & Surveying. Wood’s Grass Valley-based firm also has a satellite office in Truckee and has been working recently on Loma Rica Ranch and Timberwood Estates projects in Grass Valley and Gray’s Crossing on the eastern side of the county.

“There is a little bit of nervousness in the economy, but these are multi-year projects,” Wood said. “They see the need to get their permits in hand.”

The first 240-unit section of Loma Rica Ranch is in the permit phase, Wood said, adding the developer is likely to move forward and is assessing whether to start construction this year or next year. In Truckee, The Village at Gray’s Crossing has “scaled back a little bit,” he said, with the developers taking a wait and see position.

Several state-funded affordable housing projects — two of which are in Truckee — are slated to start construction in the next few months, Wood said.

“They’re not skipping a beat,” he said. “Housing is an important thing in the state; it’s still getting funded.”

The demand for permits and inspections has not slowed down at all, said Craig Griesbach, Nevada County’s director of building.

“Interestingly enough, we have actually increased in most areas during the pandemic,” Griesbach said in an email. “Our building permit submittals increased by 25% during March and April compared to 2019. The number of inspections we completed during March increased by 46% compared to 2019.”

Griesbach attributed part of the increase to homeowners taking advantage of being home during this time by doing projects.

Grass Valley Community Development Director Tom Last said his office was seeing “the typical springtime inundation,” although he did not have year over year numbers.

“We’re scrambling, trying to keep up,” Last said. “Inspections have been fairly heavy, too. Things haven’t slowed down at all.”

Plenty of work

While local contractors have modified work protocols to maintain social distancing guidelines, they are still seeing plenty of employment opportunities, said Nevada County Contractors’ Association Executive Director Libby Goldsmith.

“Their phones are still ringing, work is being scheduled for the summer,” she said, adding, “The construction industry has been really lucky.”

Keoni Allen, president of Sierra Foothills Construction Company, agreed.

“We’re fortunate,” he said. “We’re still busy with the projects we had underway before this started.”

His firm is wrapping up a community center at Beale Air Force Base, and a Wheatland branch of Sierra Central Credit Union.

“We’re also neck deep in the Holbrooke (Hotel),” Allen said. “We’re getting close to being completed there, hopefully in the next month or so. How fortunate are we, to have these owners … continuing to honor those historic buildings.”

Allen said he is starting to see “a bit of hesitancy” on projects in the initial stages of being discussed, however.

“The slightest bit of uncertainty in the economy can make people hesitate,” he said. “If we get some positive news, everyone will breathe a sigh of relief and move forward. I haven’t seen anything cancel yet — but people are taking a hard look at the projections.”

Goldsmith said from her perspective, the COVID-19 crisis’ effect on the economy is more akin to a natural disaster than a recession.

“We’ll see a few bad quarters and then a rebound,” she predicted. “It (won’t be) so much of an economic crash.”

One bright spot in the overall picture? In recent years, contractors have said it has been tough to find help.

“It’s been a problem for quite a few years in the industry, a lack of good, quality, experienced labor,” Allen said.

But now, contractors could see more prospects due to pandemic-fueled unemployment.

“There is a potential to pick up more workers, with layoffs in other industries,” Goldsmith said, adding there are regional efforts to promote job opportunities. “Hopefully, we can pull people back into the industry.”


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Coronavirus Guidance for Businesses/Employers

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Contact reporter Liz Kellar at 530-477-4236 or by email at lizk@theunion.com.

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