Canada Records Unprecedented Surge in Nonresidential Construction

News Summary

Canada has achieved a historic high in nonresidential construction starts with a total value of $77.2 billion, reflecting a remarkable 19.8% increase from previous figures. This growth primarily stemmed from five key megaprojects contributing over $30 billion to the total. As the construction industry stabilizes after recent challenges, focus is also shifting towards addressing Canada’s urgent need for new housing, with estimates suggesting up to 4.8 million homes required in the coming years. The ongoing investments signal a promising future for the sector.

Canada Achieves Record Nonresidential Construction Starts in May 2025

The volume of total nonresidential construction starts in Canada hit an all-time high of $77.2 billion in May 2025. This remarkable figure marks a substantial increase of $12.8 billion, or 19.8%, compared to previous months, illustrating the robust recovery and growth in the construction sector.

For the first time this year, nonresidential spending has shifted into positive territory, recording a growth rate of 6.9%. This uptick indicates that the construction industry is stabilizing after facing numerous challenges throughout the pandemic. Overall, the monthly nonresidential starts reached the highest recorded level in Canadian history.

Megaprojects Drive Growth

A significant portion of this growth can be attributed to five megaprojects that contributed over $30 billion to the total spending for the month. These large-scale projects are pivotal in shaping the future infrastructure landscape of the country. The 12-month moving average for megaproject spending now stands at $12.3 billion, demonstrating the consistency and steady pace of investment in significant ventures.

Some of the major classifications of megaprojects in May included transportation terminals, power plants and lines, and tunnels. In total, there have been 27 megaprojects worth $67.9 billion initiated year-to-date through May, representing a remarkable 50% improvement from the low average of $8.4 billion recorded in February post-COVID.

Impact on Manufacturing and Spending Trends

The groundbreaking of the Taiwan Semiconductor Manufacturing Company’s new chip plant in Phoenix, AZ, was the primary source behind the spending surge in May. As a result of this megaproject, the manufacturing category surged from being among the bottom five performers to now ranking within the top five for year-to-date performance through May.

In total, megaprojects accounted for 39% of the total nonresidential construction spending in May, underscoring their significant role in the overall construction market. A detailed analysis of the best and underperforming categories in large dollar projects for the current year is available in the Construction Economy Snapshot.

Future Housing Needs and Economic Considerations

The Canada Mortgage and Housing Corporation has indicated that the nation will need up to 4.8 million new homes to meet demand in coming years. This projection highlights the critical state of housing availability and the overall need for development across various regions of Canada.

Current economic conditions are deeply influenced by factors such as trade relations, inflation, and climate change, which all contribute to the broader construction landscape. Additionally, investments in First Nations infrastructure are deemed essential for fostering economic development and aiding reconciliation efforts across communities.

Addressing Infrastructure Gaps

Closing the infrastructure gap in First Nations communities has been emphasized as a crucial component for tapping into the economic potential of these areas. As the construction industry continues to rebound, there is hope that new projects will lead to sustainable growth and improved opportunities for many.

Overall, the data indicate that construction activity in the nonresidential sector is stabilizing following a period of declines caused by the pandemic. With a bright outlook ahead, it seems that Canada’s construction industry is poised for further development, supported by strong investments and a clear vision for future needs.

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Additional Resources

• The Globe and Mail: First Nations Infrastructure Investments and Reconciliation
• Construction Dive: Canada Construction Impact from Trump Tariffs
• Ferrovial: Ferrovial Awarded $1.2B in Infrastructure Projects in US and Canada
• Wikipedia: Infrastructure
• Encyclopedia Britannica: Construction