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ORLANDO-Construction starts are down in multifamily and office product and probably will stay down for the rest of the year, two new separate studies indicate.

Orlando ranks seventh in the country in first-quarter starts on multifamily and single-family dwellings, trailing Las Vegas, Atlanta, Phoenix-Mesa, Raleigh-Durham-Chapel Hill, West Palm Beach-Boca Raton and Charlotte-Gastonia-Rockhill.

The ranking by the Dr. Phillips Institute for the Study of American Business Activity at the University of Central Florida is based on building permits pulled per 1,000 non-agriculture jobs in 61 metro area having nonfarm payroll work forces of at least 500,000 jobs.

Orlando contractors pulled 6.18 permits per 1,000 jobs in the first quarter. Las Vegas had 11.43 permits per 1,000 jobs.

“Two years back, however, when greater Orlando was in the midst of a hearty construction boom, Orlando stood at second in the nation for the 1999 first quarter,” Dr. David F. Scott Jr., executive director of the Dr. Phillips Institute and Phillips-Schenck chairholder at UCF, tells GlobeSt.com.

But Orlando “held up reasonably well when compared against the average gain of the top six performing MSAs,” Scott says.

Orlando’s January-March performance “represents a moderate gain of 3.7% from the 2000 initial quarter, but is down by 24.8% from the average quarterly rate across all of 1999,” the professor says.

He calls his rankings an index of private construction intensity. “This procedure provides both a locally oriented measure of construction vigor and serves as a leading indicator of confidence by local building contractors in the economic strength of the region,” Scott says.

Not unexpectedly, Las Vegas is the hottest construction market in the United States. “This is a familiar position for Las Vegas as it placed first for the same quarter one year back and for all of 2000,” Scott notes.

Other Florida metro areas making Scott’s top 20 list are Jacksonville, No. 8; Tampa-St. Petersburg, No. 15; and Fort Lauderdale, No. 18. Florida placed five metro areas in the top 20. Texas followed with three areas.

The top 20 metro areas, showing permits per 1,000, are Las Vegas, 11.43; Atlanta, 7.55; Phoenix-Mesa, 7.19; Raleigh-Durham-Chapel Hill, 6.77; West Palm Beach-Boca Raton, 6.47; Charlotte-Gastonia-Rock Hill, 6.31; Orlando, 6.18; Jacksonville, 6.10; Sacramento, 5.50; Riverside-San Bernardino, 5.43.

Also: Fort Worth-Arlington, 5.27; Austin-San Marcos, 4.72; Kansas City, 4.50; San Antonio, 4.44; Tampa-St. Petersburg, 4.29; Nashville, 4.28; Denver, 4.21; Fort Lauderdale-Hollywood, 4.16; Indianapolis, 3.97; and Richmond-Petersburg, 3.82.

Preliminary second-quarter office construction figures compiled by the Orlando office of Grubb & Ellis Co. back up Scott’s view on a slowing construction market.

There was 1.69 million sf of new product in the pipeline at the end of June versus 2.16 million sf in this year’s second quarter and 1.81 million sf in second quarter 2000.

This year’s quarter-to-quarter decrease was 467,231 sf. Second quarter 2001 versus second quarter 2000 shows a decrease of 123,870 sf.

More new product surfaced this year than last year, however. A total 873,790 sf was completed in this year’s second quarter versus 605,485 sf finished in the first three months, an increase of 268,305 sf.

Comparing year-to-year periods, the 873,790 sf of completed office in this year’s second quarter was up 588,326 sf over the 285,464 sf done in second quarter 2000.

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