The number of construction permits saw a 10.60% year-on-year (y-o-y) drop to reach 13,727 by November 2015, compared to a higher level of 15,355 during the same period last year. In the same context, the construction area authorized by permits (CAP) declined by a yearly 12.13%, amounting to 11.04M sqm in the first 11 months of 2015, compared to 12.56M sqm in 2014.
Noting that permits are usually issued at least 6 months after applications are filed, the fall in construction activity can be due to the ongoing slowdown in the whole economy attributed to the slump in Foreign Direct Investments (FDIs) and the regional and domestic instability. In fact, the six-month moving average of the number of construction permits (pictured below) illustrates the decline witnessed in the sector since 2011, following the eruption of the Arab spring.
As for the average area per transaction, it decreased marginally from 817.955 sqm/permit in 2014, to 804.00 sqm/permit by November of this year.
Looking at November alone, the number of permits stood at 1,168, a 4.10% y-o-y increase from November 2014’s level. Similarly, CAP witnessed an 8.07% yearly increase to 979,858 sqm from 904,232 sqm registered in the same month of last year. In terms of regions, Mount Lebanon grasped 39.47% of total permits, followed by South Lebanon and Nabatiyeh with respective shares of 19.18% and 14.29%.
Monthly Number of Construction Permits
Source: Orders of Engineers in Beirut and North