Construction industry reps say delayed Cape Breton projects not cause for concern

Construction industry representatives say there's no need to panic over a number of delayed residential developments in Cape Breton.

Last week, the Nova Scotia government put construction of a new nursing home on hold for up to two years and Cape Breton regional councillors were asked to approve a delay in building a residential tower on Sydney's downtown waterfront.

Some council members speculated that higher labour costs might be the cause.

"Every project I'm aware of is hitting cost overruns and at the same time we have to sit down with our construction and development community, our building construction trades community, to talk about how are we cost-competitive here," said Mayor Cecil Clarke.

"And the other aspect is when people come in and say that the cost of construction in Cape Breton is higher than other parts of the province, we have to analyze that and say, OK, what are those impediments."

Coun. Glenn Paruch wondered if factors such as regulatory red tape could be involved.

"I just don't know if this is becoming a trend here in Cape Breton where we're delaying projects that typically could move forward," he said.

The province said it was pausing the new MacGillivray Guest Home project because only one bid was received and it was far over budget. The government said that might be due to the number of large infrastructure projects underway in the region.

Meanwhile, Doucet Developments asked regional council for a deadline extension on its proposed waterfront project, saying costs had gone up and it had to redesign the development after a hotel chain dropped its interest in the site.

CBRM planner Karen Neville said a significant delay was due to the unavailability of equipment the contractor needed to confirm the lay of the land.

Interim chief administrative officer Demetri Kachafanas told council another delay was due in part to two other deadline extensions the contractor had requested.

He said as a result, it was deemed to be in CBRM's best interest to renegotiate the sale of the land.

"The former CAO thought it wise that we get an updated appraisal because of the time that had passed and the market change in the price," Kachafanas said.

"We do have that now so it looks like the deal can close pretty quickly."

Ernie Dalton, president of the Cape Breton Island Building and Construction Trades Council, said material and other costs have gone up everywhere due to the pandemic and inflation.

But he said labour costs on the island have been stable, because the council negotiated a longer-than-normal collective agreement in 2020 on behalf of unions.

"I think labour's been the most consistent part of projects," Dalton said. "We signed a five-year agreement, our labour council did, to have consistent wages for our contractors to be able to bid work."

He said the MacGillivray Guest Home delay seems to be a one-off.

"It's not typical that we'd have only one bidder, but sometimes that does happen from time to time, depending on the amount of work that a contractor may have.

"I don't hear of anybody else delaying projects. Actually, I hear of people looking to do more projects, especially on the west side, up in around Inverness and Cheticamp."

The executive director of the Nova Scotia Construction Sector Council, which includes builders, agreed.

Trent Soholt said the cost of construction in Cape Breton is not higher than elsewhere and projects get delayed for a wide variety of reasons.

"It could just simply be that contractors are busy right now and can't focus on a project at this exact time, but maybe in a month's time or two months' time they'd be able to transition into that project," Soholt said.

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