Construction Poised for Another Banner Year in 2017

Value of Kalispell development hit $129 million in 2016, more than previous two years combined

By Dillon Tabish
Construction in Whitefish. Beacon File Photo

Construction activity swelled to grand proportions last year in Kalispell, totaling more value than the previous two years combined and surpassing pre-recession levels.

Kalispell saw total construction worth $129 million in 2016, according to the city’s planning office, which recently released its annual report detailing development data. The year-end total, which represents the amount of money spent on building supplies and labor for residential and commercial projects, is higher than each of the pre-recession years between 2005-2007, when the Flathead Valley was experiencing booming growth. The 2016 total was also higher than the combined annual totals from 2010-2012.

Kalispell added more than 450,000 square feet of new non-residential construction space last year. In comparison, 2015 saw nearly 200,000 square feet of new space, and in 2007, the city added just over 300,000 square feet.

The significant economic momentum from 2016 is carrying into the new year with several big projects in the works or on the horizon, including the development of a new $15 million elementary school and continued expansion in the residential and commercial markets.

“It’s going to be another banner year for construction activity (in 2017),” Kalispell Planning Director Tom Jentz said.

At its Feb. 6 meeting after the Beacon went to print, the city council was slated to review a proposal for the Kalispell North Town Center, formerly the Glacier Town Center, which is seeking to build 11 commercial lots and one multi-family lot between Whitefish Stage Road and U.S. Highway 93. Also, the council reviewed a proposal for the Southside Estates, a 29-lot residential expansion on Merganser Drive.

Kalispell permitted 222 housing units last year, the most since 2007, when 322 new units were constructed. The new housing facility being built at Flathead Valley Community College provided a boost to the residential total. The college is planning to complete its new 100-bed complex by fall.

The largest single driver of development came in the health care sector, which has become the leading employer in Flathead County. Kalispell Regional Healthcare is developing a $36 million women and children center at its campus on Sunnyview Lane. The 190,000-square-foot facility broke ground in summer and is slated to open in spring of 2018. The hospital is also developing a new digestive health unit that will be housed in a 25,000-square-foot building with 16 exam rooms and three operating rooms. Also, the hospital is finishing the $14 million expansion and renovation of the emergency services department.

Immanuel Lutheran Communities is also undergoing significant growth and is working on its first of five expansion phases. The entire project is slated to cost $45 million.

“Medical construction is definitely leading the way,” Jentz said.

Jentz said the uptick in residential growth was also noteworthy, and he predicts continued expansion with multi-family units, such as apartment complexes.

“There is lots of interest in multi-family because the community needs it,” he said.

The retail industry expanded with the new 55,000-square-foot Hobby Lobby in Spring Prairie and the 40,000-square-foot addition of Herberger’s at the Kalispell Center Mall, which is currently underway.

There are remaining lots available in Spring Prairie for commercial developers, but retailers across the country are slowing growth due to the rise of e-commerce providers such as Amazon.

Kalispell is also running into another challenge: the lack of suitable building space.

“We are physically running out of building lots,” Jentz said.

The city has vacant land, but whether it will be considered cost-effective for new residential growth compared to the county remains to be seen, Jentz said.

Also, the harsh winter has delayed a large portion of projects, meaning activity is being pushed back, Jentz said.

“This has been a hard winter, which really slows the opening of new projects,” he said.

To read the 2016 Construction, Subdivision and Annexation Report, visit http://kalispell.com/planning/documents/2016AnnualReportFINAL.pdf.

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