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New Building Construction Boosts Economy On the Big Island

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The recession was not kind to the Hawaiian Islands, but it was especially hard on the Big Island. When Oahu and Maui bounced back, Hawaii still struggled with higher unemployment and a stagnated real estate market and construction projects were put on hold for years. Things are finally changing.

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With the opening of the new nine-acre Kaiser Permanente Kona Medical Office on Honokohau Street in July and the flurry of building going on right now at the new Kohanaiki resort and Palamanui Community College, the sound of new construction is music to the local building industry's ears.

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Other new building projects going up in West Hawaii include the new radiology building in downtown Kona, All'i Heights in Kona and Sunset Ridge and the Kamakoa Nui project, both in Waikaloa Village.

This is good news for the local economy, which experienced the loss of hundreds of construction jobs during the recession starting in 2008.

"Our company, Kokua Roofing, is definitely seeing an upswing in the economy. Our company was recently tapped to re-roof 17 condo units at the Keauhou Resort condo complex, and we were responsible for a large portion of the new roofs at the luxury Kohanaki Resort south of the Kona airport.

We are also working with several private homeowners to re-roof houses all over the Big Island so photovoltaic solar panels can be installed. In fact, permits for new PV are strong, which helps the construction industry, electricians and roofers, in particular", said Kokua Roofing, CEO, Ron Lloyd.

Building permits, a bellwether of the local construction industry, have continued to rise since the downturn, providing opportunity for many people working in the trades, which in turn, helps the West Hawaii economy.

Hawaii County Department of Public Works/Building Division in 2013 issued nearly 12,000 building, electrical, plumbing, and sign permits island-wide -- a 30 percent increase over fiscal year 2011-12 - for projects worth an estimated $678 million, the Department of Public Works engineering division Issued over 600 engineering permits for right of way, grading, grubbing, stockpiling, subdivisions, and construction plans.

Just a sampling of the Public Improvement projects: The Ka'iminani Road project was focused on reconstructing the roadway, retaining walls, and drainage that includes a six-foot shoulder, with tie-ins to private driveways. 80 percent of the $10 million construction cost is paid by the Federal Highways Administration.

For residential housing, sales are increasing at the new All'i Heights in Kona and Sunset Ridge as high demand for housing in an extremely tight real estate market currently exists in West Hawaii.

East Hawaii now has to deal with the after effects of Hurricane Iselle, but the recovery, will bring new construction jobs, as well. Construction will begin in the fall on the new Thirty Meter Telescope, slated to bring funds and additional jobs to East Hawaii.

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Construction projects which have been put on hold for years, waiting for a more favorable economic climate, are just beginning to come on line. A senior residential facility above Pottery Terrace is one of these projects. Rumored to be able to add hundreds of new jobs, as well as new residential housing options for seniors, it is seen as a boost for West Hawaii.

Other local building professionals are seeing similar examples of the Big Island finally recovering from a long down turn.

Steve Machesky, owner of KCPM Inc. dba Kokua Contracting and Project Management, who has been in contact with civil engineers and architects, reported that there is a significant uptick in new projects or older projects that were "mothballed" during the recession coming back to life. "In general terms, the design industry usually sees the first "wave" of this development which could translate into new work.

This is, of course, dependent on the ease of financing and cost of borrowing. The building of new single family homes appears to be making a recovery and net metering solar systems have been a big part of the addition or remodeling industry island-wide," Machesky stated.

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