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Illustration 60886103 / Kheng Ho To / Dreamstime
Illustration 60886103 Kheng Ho To / Dreamstime
60886103 / Kheng Ho To / Dreamstime
(Photo by Spencer Platt/Getty Images)
Growth is returning to the Orlando metropolitan area, recalling the heady days of booming residential and commercial construction captured in this 2005 photo.

Orlando Market Juiced by Solid Gains in Construction Employment and New Projects

April 8, 2016

While fast-growing cities like New York, Boston, San Francisco, Seattle and Miami snatch many of the headlines on the construction scene because of all their glitzy condo towers and new office projects underway and on the drawing boards, a smaller metropolitan area is showing some impressive growth, too.

With approximately 2.3 million residents, the Orlando metropolitan area is dwarfed by some of these larger cities, but Orlando and neighboring towns in the Orlando-Kissimmee-Sanford Metropolitan Statistical Area (MSA) have some gaudy demographic and employment metrics that should support solid economic growth in central Florida for the next few years.

The Orlando MSA added 247,573 new residents from 2010-2015, according to the U.S. Census Bureau, and this 12% increase in population was the 13th most of more than 380 MSAs. All  of these new residents need places to live, and the residential construction market has been keeping pace, with 12,328 single-family building permits pulled in 2015, up 25.7% from 2014, and 7,783 new multi-family permits last year, a 24.8% increase.

Willis Milner, principal, United Electrical Sales, an Orlando-based rep, says Orlando and the Florida market are finally starting to show some solid growth after  the recession, which battered the electrical market with declines that topped 50% in some segments of the construction business. Milner says he has been through four recessions in his 40-plus years in Florida’s electrical business, and said the most recent one from 2008-2011 was the worst to hit the Sunshine State during his career.

He says residential construction has been strong the past three years in Orlando and throughout out the state and that commercial construction is finally starting to pick up this year, including the first new school to break ground in the metro since 2009, university expansion and additions to theme parks. Business has been so strong in Orlando that some electrical contractors are having trouble finding workers for new projects and are partnering with competitors who have available workers. Milner said contractors’ employee shortage has created additional demand for electrical products with labor-saving capabilities like Legrand/Pass & Seymour’s Plug Tail receptacles.

Other notable construction projects that will break ground in the near future, including a $1.8 billion expansion of the Orlando International Airport that will add 2.7 million square feet of building space and could begin as early as 1Q 2017; Magic Development’s $3.3 billion, 87-acre vacation village near Disney World; and a $100 million in several large medical projects.

A report in the Orlando Business Journal said, “Orlando-based Magic Development LLC will start work on infrastructure in July on the first phase of its massive development called Magic Place, which will involve a 25-story, 251-unit resort tower, along with 40,000 square feet of retail space and a 20,000-square-foot office building.”

The newspaper also reported that Orlando Health and the West Orange Healthcare District will be building a 30,000-sq-ft cancer center; a 100-bed nursing facility; and a 70,000-sq-ft multi-purpose medical facility.

Of particular interest to many in the electrical market is the 13% year-over-year growth in the number of construction workers in Orlando. According to Electrical Marketing’s data estimates, amongst the 7,500 new construction workers are about 975 additional employees at area electrical contractors — and $42.89 million in new market potential for Orlando-based electrical distributors selling to electrical contracting firms. Electrical Marketing estimates electrical contractors in the Orlando area employ roughly 8,463 workers — and offer distributors $371.8 billion in buying potential, according to our sales-per-employee calculations. Our historical data shows that electrical contractors account for 13% of all construction employees. Each of these employees represents $43,993 in buying potential, according to Electrical Wholesaling’s 2016 Market Planning Guide.

Several Florida economists in recent Orlando news reports emphasized that for the long haul, the metro needs to attract more higher paying jobs and not rely as heavily on the tourist trade and lower paying entry-level jobs at DisneyWorld, Universal Studios and other amusement parks, as well as the businesses that support the region’s many other amusement parks.

 Florida’s construction industry sees higher highs and lower lows than other regions of the country because of the size of the state and the cyclical vacation home/tourist segment. But with the area’s construction market still climbing, area distributors, reps and manufacturers should be able to enjoy the ride for a while.