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Economy is surging in several sectors

POSTED: January 5, 2014 9:04 p.m.

New home construction is picking up at Cresswind at Lake Lanier as multiple crews brave cold weather Friday to work on new homes.

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As bad as the economic downturn was, economic forecasters and others are hoping for as strong an uptick.

While that may not be possible, there are definite signs the economy is improving.

“We’re starting to see (an increase) in sales volume and an increase in sale prices,” said Steve Watson, Hall County’s chief tax appraiser.

“The thing that’s important to remember is ... when the real estate market pretty much stopped, it dropped like a rock. And it’s not going to go up at the same pace that it went down. That’s just basic economics.”

Still, there’s a batch of encouraging news.

Locally, home construction and retail development are on the rise and a huge investment in health care construction is taking place. Metro Gainesville’s jobless rate was 5.9 percent in November, the lowest since September 2008.

On a wider scale, the stock market is surging, and state revenues are higher than last year.

The number of new home permits in Gainesville increased from one in 2010 to 206 in 2013. The last time Gainesville issued that many permits was 2004, at 236.

“That corresponds with the economic downturn in 2010, and I think it’s shocking for people to actually see in black and white,” said Rusty Ligon, Gainesville’s community development director, who has prepared a PowerPoint slide showing the dramatic increase.

“And we do anticipate, as we go into 2014, to stay as high as we were in 2013, if not surpass 2013.”

Watson noted as much, saying new home building especially has taken off at such developments as Cresswind at Lake Lanier in Gainesville and Village at Deaton Creek in South Hall, both active adult communities.

Robert Rademacher, vice president of the Kolter Group, which is developing Cresswind, said, “The (sales) numbers are all fabulous, and we’ve got the biggest backlog going into (2014) that we’ve ever had, as far as future orders go.”

He attributes some of that growth to pent-up demand for the product Cresswind offers.

“Everybody we talked to wanted to buy from us but couldn’t sell their house,” Rademacher said.

Much of America’s economic implosion can be traced to the Great Recession, which began in December 2007 and lasted 18 months, the longest of any downturn since World War II, according to the U.S. National Bureau of Economic Research, a private group of leading economists who determine recession time frames.

“The causes were many, but fundamentally it was caused by imbalances in the private sector ... particularly in the property and financial markets ,” said Jeff Humphreys, director of the Selig Center for Economic Growth at the University Center of Georgia in Athens, in an earlier interview.

The effects were widespread, from layoffs to sharp erosion in or elimination of home equity, or the difference between the payoff and a home’s worth.

And the recovery has been grindingly slow. Gainesville’s new home permits, for example, didn’t top 100 until this year.

Rajeev Dhawan of the Economic Forecasting Center at Georgia State University’s J. Mack Robinson College of Business was cautiously optimistic in his Forecast of Georgia and Atlanta, released Nov. 20.

The state’s year-over-year job growth rate in August outperformed the national job growth rate for the same period — 2.3 percent versus 1.7 percent — and the Atlanta metro area is closing the gap on returning to its prerecession job peak, according to Dhawan.

“We could be poised for a takeoff in growth,” he wrote in his report. “There are national and global roadblocks over which we have no state control.”

Among those roadblocks were uncertainty over the potential for a second government shutdown and mixed news globally, according to the report.

Hall County appears to be forging ahead on industrial and commercial growth.

In the past two years or so, 58 new and expanded businesses created 2,200 jobs and generated $283 million in capital investment for the area, said Tim Evans, the Greater Hall Chamber of Commerce’s vice president for economic development, in an October presentation.

In October, Gov. Nathan Deal’s office announced King’s Hawaiian in Oakwood planned to double production at its current plant and build a neighboring 120,000-square-foot facility over the next year, creating more than 400 jobs by 2016. The company has been operating in a 120,000-square-foot plant since the fall of 2011.

“In terms of expansions and continued job growth, we see that trend will continue in 2014,” Evans said in a recent interview.

“In the last 12 months, small business activity has picked up again, and that’s really encouraging because small businesses make up most of the companies and employment in not just Hall County, but America.”

Major retail development has generally stalled in South Hall, but Flowery Branch City Council held a first reading Thursday toward annexation and rezoning of four “highly developable properties” adjacent to its busiest retail centers at the intersection of Spout Springs and Hog Mountain roads.

And the city adopted a redevelopment plan for its historic downtown.

Oakwood has seen sporadic growth on Mundy Mill Road and Thurmon Tanner Parkway near Mundy Mill, with the opening of new fast-food eateries.

Construction work could begin this month to convert the old Sam’s Club building at 3137 Frontage Road, near Mundy Mill Road and Interstate 985 to Northeast Georgia Health System’s corporate support service center.

The health system, meanwhile, is building the 100-bed Northeast Georgia Medical Center Braselton off what will be the new Ga. 347. The South Hall hospital is expected to open in spring 2015.

Building permits issued for the hospital made up $127 million of the $156 million in total values stemming from last year’s Hall County permits, officials said.

Still, the balance of $29 million in values is twice as high as the 2012 total, $14 million.

According to Ligon, Gainesville had 18 permits for new commercial starts in 2013, up from 12 in 2012 but down from 41 issued in 2009.

One of Gainesville’s biggest shopping centers will be New Holland Marketplace, anchored by a Kroger grocery store, which is being built off Jesse Jewell and Limestone parkways, near Interstate 985. The Kroger is on track for a March 19 grand opening, and a QuikTrip convenience store is under construction on a 12-acre site across the road.


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