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Eric Hubbard, of Puetz Corp., removes metal siding Monday afternoon from the overhang of County Fair Food Store in Mitchell as a renovation and expansion of the store progresses. The building permit for the project was among 178 issued last year, the most building permits issued by the city since 2006. (Chris Huber/Republic)

Mitchell sees spurt in 2011 construction

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Last year was the busiest for issuing building permits in Mitchell since 2006.

The city issued 178 building permits in 2011, according to Building Inspector John Hegg. That's four more than were issued in 2010 and the most since 186 were issued in 2006.

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"It's a nice increase, I would say," Hegg said Monday.

The valuation of the properties in Mitchell that received permits is $23.8 million, according to a report on the city website. The city collected $80,827 in permit fees. Both are all-time highs.

The largest number of permits, 51, was issued for garages. The second greatest total, 41, was for residential additions and repairs.

Another 28 were issued for commercial additions and repairs, followed by 21 for new residential buildings, 16 for new commercial buildings, three for cell-phone towers, two for duplexes and one for a school.

The busiest times were in the warmer months, as 27 permits were issued in September, 22 in July and 20 in June.

The months with the largest dollar figures attached were in the fall, however, thanks to a pair of major projects.

A permit for a $7 million health sciences center at Dakota Wesleyan University was issued in October, while a $3.15 million permit was issued in November for the County Fair Food Store expansion project.

The DWU project has been described as costing $11.5 million, but Hegg said the permit is issued only for the building, not for dirt work or infrastructure work tied to the effort.

The slowest month was, not surprisingly, in the winter. Just one permit, for a $200,000 office remodel at the Abbott House, was issued in January.

Mitchell Area Chamber of Commerce and Mitchell Development Corp. Executive Director Bryan Hisel said the spike in building permits is welcome news.

"People are doing that because they're confident," Hisel said. "If you're confident in the local economy, you will make that kind of investment."

He said there's another reason people are putting money into their homes.

"Interest rates are at historic lows," he said. "For those of us who remember the 1980s, it's almost astonishing how low it is."

Hisel said he noted there was $11 million of commercial development in Mitchell in 2011.

"And that's always a good sign," he said. "Those are pretty good positives."

The city issued 15 permits for demolitions. No fees are collected for those permits, but they are included in the total.

Hegg said the permits are issued for demolitions to aid in determining what properties are to be removed from the tax rolls.

While more permits were issued in 2006, the valuation of those properties, $14.5 million, was less than the value of the properties that were permitted in 2011.

The most permits in recent years were issued in 2005, when 202 permits were sold to developers. The value of those properties was $22 million, short of last year's total.

Other South Dakota cities, including Sioux Falls and Rapid City, also saw increases in the number of building permits issued, Hegg said. He speculated it could be a sign that the economy is on the grow.

Sioux Falls Chief Building Official Ron Bell said that city issued 7,823 permits compared to 7,674 in 2010. That's an all-time high, Bell said.

The value of the properties also increased from 2010, going from $282.9 million to $291.1 million in 2011. But that's well short of the boom years in the mid-2000s, when Sioux Falls saw a peak of $523.1 million in 2007.

Most of the Sioux Falls permits issued in 2011 -- 81 percent -- were for remodel and repair residential projects, Bell said.

"So what really drove the permits is people working on their own properties," he said.

Bell said there was a "significant increase" in the valuation of new commercial properties that were built in 2011. There were 33 permits issued for new commercial buildings with a valuation of $42 million, compared to 27 permits for $23 million worth of projects in 2010, he said.

Not all the news was good, however. Sioux Falls saw 347 single-family dwellings built, which was "very low," he said.

Mitchell issued 20 permits for new residential properties, in line with other recent years. It issued 24 such permits in 2010, 21 in 2009 and 20 in 2008. It issued 40 in both 2007 and 2006 and 53 in 2005.

Rapid City Building Official Brad Solon said that city set a record for permits and valuation in 2011.

It issued about 4,500 permits last year, compared to about 2,900 in 2010, Solon said. Most of the increase in permits can be tied to three large hailstorms that generated 1,600 permits for roofing projects, he said.

But that doesn't explain the dramatic rise in valuations, Solon said. The value of the properties rose from about $131 million in 2010 to approximately $245 million in 2010, he said. The former record was $212 million, Solon said.

"We're way up from last year," he said. "It was a good year."

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