Spokane Construction Surges After Year of Sharp Declines

The turnaround is stark. Through February 2026, Spokane issued 80 housing units with a valuation of $19.45 million, according to the city's monthly permit report. That represents an 81% increase over the same period last year, when the market was in freefall. Commercial permits tell an even more bullish story: 53 new commercial applications opened year-to-date, a 212% jump from just 17 permits in early 2025.

The recovery comes after 2025 dealt Spokane's construction sector a devastating blow. Building permit values collapsed 44% in the first nine months of 2025, dropping to $362 million from $650.5 million the previous year. Single-family home permits hit a record low of just 146 for the entire year, down from 214 in 2024. Multifamily housing took an equally severe hit, with only 424 residential units permitted through September 2025 compared to 817 units the prior year. Even mixed-use projects vanished from the pipeline entirely, with zero permits issued after 119 units were approved in 2024.

City officials attribute part of the 2025 decline to the absence of major projects that had bolstered 2024 numbers, including a $100 million expansion phase by Jubilant HollisterStier LLC at 3525 N. Regal. But the broader slowdown reflected tightening credit conditions and rising interest rates that rippled through Eastern Washington. Steven MacDonald, the city's Community and Economic Development Director, oversaw a period of record permitting from 2021 through 2023, when Spokane processed 35,769 permits in 2023 alone.

The February 2026 spike includes meaningful wins for affordability. The city issued 24 units of affordable housing for families through Catholic Charities and another 24 units for clients working with Frontier Behavioral Health, according to permit data. These developments suggest that even as the market rebounds, the city is maintaining focus on addressing Spokane's persistent housing shortage that has kept inventory tight and home prices elevated.

With year-to-date valuations now 78.7% higher than the same period in 2025, development leaders are cautiously optimistic about the remainder of the building season. The 212% surge in commercial permits—compared to a five-year average of 25.7 permits—provides what city officials call "a good signal of the strength of this year's building season." For a market that endured one of its worst years on record, the rebound, however early, offers concrete evidence that Spokane's construction sector may be turning a corner.