For apartment developers in the Twin Cities, the past few years have been the best of times. But a government-ordered shutdown that takes effect Friday to thwart COVID-19 could slow inspections and shutter job sites has developers on edge and scrambling to keep projects on schedule.
"We have not seen a slowdown in construction yet," said Kent Roers, co-founder of Roers Companies, which develops and manages apartment buildings in the Midwest.
"But I know it will come and I assume we will see it next week."
The company now has nine projects under construction, most of them in the Twin Cities. Roers says he's already expecting a decline in the number of projects that will break ground, and that the stay-at-home order will slow leasing and construction, most likely because of interruptions in the supply chain. "Workers can show up, but can they get the supplies they need to get their jobs done," he said.
As developers speculate about how many planned projects won't break ground, the focus is on keeping job sites open while implementing complex new job site practices aimed at protecting the health and safety of workers.
Putting projects on hold isn't an option, said company co-founder, Brian Roers. By the time construction is underway, developers have already spent significant amounts of money and are committed to construction loans.
"We've been through this before, and what we've learned is that you keep going and figure it out as you go along," he said. "If you put the brakes on a project, the wheels come off."
The stakes are enormous, for developers and the broader economy. Apartment construction led the building industry out of the recession and has since remained the dominant sector. Last year, $4.8 billion in residential construction happened throughout the 13-county metro, according to Dodge Data and Analytics. That was $1.4 billion more than commercial construction (retail, hotels, etc.) and a 7% increase over the previous year.