The dramatic population growth in the oil patch town of Watford City is fueling demand for housing and commercial space, but city officials are concerned that a lack of infrastructure could get in the way of the booming development.
Workers streaming into the area for lucrative oil-industry jobs have pushed the town's population from about 1,750 in the 2010 census to an estimated 8,000 in the area today. But the housing supply hasn't kept up, driving seemingly nonstop construction.
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About 2,500 housing units are under construction or permitted to be built in the Watford City area, but the lack of infrastructure "is the roadblock to getting even more built," said Gene Veeder, economic development director in McKenzie County, the state's top oil-producing county.
"Right now, most of the infrastructure has been on the backs of the developers themselves, which adds to the cost of that housing," he said. "We are sorely in need of additional water and sewer and urban gutter type projects, but we are continuing to fight for some share of state funding to help us with that."
One recent project in Watford City by New York-based Coltown Properties involves residential and commercial developments worth at least $65 million. Company principal Israel Weinberger said he expects three apartment buildings to be ready for occupancy this fall, with the end goal being 325 apartments in seven buildings. Retail and office space should be ready by late 2015 or early 2016.
"I think it has phenomenal potential," Veeder said, noting later that the city planner has worked closely with the company.
Coltown Properties, which has mostly focused on work in New York, is among the investors far outside the state attracted by the housing needs. Among others are a Singaporean company and a Swiss company that have announced mixed-use developments worth $800 million in the oil patch.
Census data released in May shows that North Dakota had the highest housing growth rate in the country — for the third consecutive year.
Weinberger said his company became interested in western North Dakota early last year and eventually set its sights on Watford City.
"We think it's central to the Bakken," he said, referring to the oil producing rock formation driving North Dakota's oil boom. "I think it is and is going to be very relevant to the entire play there."