Building volume, value plummet in Henrico, Chesterfield

Construction in Richmond is entering a deep chill. Building volume is down as much as 50 percent in some parts of Richmond. And the projects that are coming out of the ground appear to be smaller than in the past, according to an analysis of building permit data.

But despite a steep pullback, the permitting departments at local municipalities have avoided layoffs so far. Henrico and Chesterfield counties say they are leaving vacancies unfilled. The City of Richmond has a hiring freeze in place and will not fill 11 positions in the permitting and inspecting division. Richmond does not plan on letting go any inspectors even if permit volume continues to slow.

The volume of permits in the City of Richmond fell from 65,511 in the 2009 fiscal year to an projected 59,000 this year, or about 10 percent.

“We haven’t seen a drop like in the counties which are mostly single family housing. We have a much more diverse construction portfolio,” said Rachel Flynn, Richmond’s director of community development.

The volume of applications for residential building projects in Chesterfield fell by 56 percent in November compared with the same month a year ago. Last month the county added 50 residential units, compared with 148 in November last year.

So far this year, Chesterfield has issued about 200 more residential building permits than this time last year, but the estimated costs of the projects have decreased by 38 percent.

From January 2007 to November 2007, the cost of construction (for which 3,266 residential building projects had been issued) was an estimated $302.8 million. This year, the value of 3,433 residential building permits has fallen to $188.25 million.

The number of residential boiler, electrical, fire, gas, mechanical and plumbing permits is also falling in Chesterfield. Inspectors completed about 15,000 fewer residential inspections so far this year compared with last year for system permits.

As a result of the decreased activity, Chesterfield County has frozen filling vacated inspector positions, said Bill Dupler, Chesterfield’s building director, but there are no immediate plans to cut existing positions.

“We’ve been for the last year and a half going through attrition — nine staff down from about two years ago,” Dupler said. “[We’re] not replacing anyone as they leave.”

The Chesterfield Department of Building Inspection has 62 full-time employees. Dupler said the department has moved a handful of residential inspectors over to work on the commercial side.

Permits volume for commercial building has been more stable in Chesterfield, but applications for that sector are still down about 8 percent this year compared with 2007. The value of those projects has fallen about $60 million, or 23 percent.

County revenue collected from permit fees has not fallen as drastically because of a 14 percent rate increase that went into effect July 1. The county has collected $1.9 million this year for fees on building permits. Last year that figure was $2.1 million.

Permit volume has also slowed in Henrico. The number of permits issued in November was 824, 40 percent less than the same month in 2007. The number of building permits issued for single-family homes fell from 73 in November 2007 to 24 last month. The number issued for the fiscal year to date has fallen 43 percent.

Commercial permits, meanwhile, fell 8 percent. There were seven permits issued for new commercial buildings in November compared with three the same month last year.

“We’ve had a couple large commercial projects that have continued and they are keeping the inspection numbers up,” said Bolman Bowles, Henrico deputy building officer. Bowles said he expects the volume of commercial projects to fall next year. He also said there hasn’t been any recent rate increases, nor has there been any mention of a future hike.

The value of building projects in Henrico has fallen more than 50 percent, from $335.3 million in 2007 to $158.6 million this year. Several large residential projects in Henrico have come to a standstill.

Henrico County has three unfilled positions that it doesn’t intend to fill, Bowles said. There are no cuts or layoffs in the near future, Bowles said. Henrico employs 31 inspectors, according to the county’s website.

“Now we are able to get to [inspections] the day they are requested. Before we were excessively busy,” Bowles said. “We weren’t meeting our turnaround goals, so now we are.”

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