Commercial starts drive workload rise as housing cools

Aaron Morby 11 years ago
Share

Commercial and civil engineering work are starting to take over as the main driver of construction activity in the UK.

According to construction information specialist Glenigan’s latest survey of project starts, commercial activity is ramping up at a marked pace, driving construction growth into the fourth quarter of 2014.

Office and retail starts both soared 25% year-on-year, with the commercial sector boosted by several major London schemes, including the £95m One Mitre Square development which broke ground in August.

Across the industry as a whole the value of projects starting on site during the three months to October rose 4% year-on-year, marking 17 months of consecutive growth.

Allan Wilén, Economics Director at Glenigan, said: “Commercial and civil engineering work are taking over from housing as the lead drivers of new construction starts.

“This broad footing of construction growth bodes well for the upcoming period of political uncertainty ahead of the general election, and as expectations of an interest rate rise appear to be dampening confidence among UK homeowners.”

Following last month’s dip, the Glenigan Residential Index is hovering just outside of negative territory, recording no change compared to a year earlier.

Private house building remains on the up, despite the recent stall, with starts rising by 15% so far in 2014. But social housing continues to struggle due in part to winding down of the first Affordable Housing Programme.

This divergence can also be seen within the planning pipeline; during the three months to September the underlying value of private housing approvals was up by 24%, while social approvals were down 24%.

A weakening in industrial confidence has coincided with the first fall in project starts for the sector since July last year. Nonetheless, Glenigan expects this slowdown to be short-lived, with industrial remaining on course to be the fastest expanding sector during 2014.

A substantial flow of prospective industrial projects continues to make its way through the planning pipeline, with the underlying value of projects receiving approval up 42% in the three months to September.

Freed from the constraints of referendum uncertainty, a slew of work starting during October has seen Scotland return to growth after four months of declining starts. As in recent months, the northern English regions, Northern Ireland and Wales are gaining ground fastest, all seeing double digit growth over the last three months.

By contrast, the East and South West of England saw starts fall back compared to a year ago, while the South East has kept pace with the UK average of 4% expansion.

Latest news

80 energy projects unlocked as Ofgem backs grid expansion

£24bn energy networks deal gets green light from regulator
19 hours ago

New boss at Eric Wright Civil Engineering

Gavin Hulme takes top job as Diane Bourne moves to group role
4 hours ago

Pinewood submits £1bn data centre plan

Studio giant adds green and learning spaces to tech hub blueprint
20 hours ago

Record results after TClarke goes private

Britain's biggest M&E contractor flourishes after de-listing
20 hours ago

Dalkia lands £200m nuclear maintenance deal

1,000 nuclear FM staff to join M&E contractor
20 hours ago

Construction comeback to outpace wider economy

Arcadis forecast fueled by spending review optimism
2 days ago

First steel goes up on giant car battery site

Severfield gets to work on McAlpine Somerset site
2 days ago

Permasteelisa wins cladding deal on Bovis city tower

Facade specialist lands package at 60 Gracechurch Street
20 hours ago

Fox buys recycled asphalt specialist Fisher

Acquisition adds major recycled asphalt capacity in north west
2 days ago

Major Building Safety Regulator shake-up to end tower delays

HSE stripped of control and top fire chiefs brought in to fast-track stalled schemes
2 days ago

Hinkley trio sign Sizewell civils deal

Balfour,Bouygues and Laing O'Rourke form Civil Works Alliance for new power station
2 days ago

£3.9bn data centre plan for Ravenscraig steelworks

Green energy to power massive new steel to silicon AI campus
2 days ago

Breakthrough on HS2’s second longest tunnel

8.4 mile Northolt to Old Oak Common drive completes
2 days ago

Neilcott on fast-track to debt-free employee ownership

£22.5m loan nearly paid down after big profit year
2 days ago

TfL kicks off race for £700m Tube station upgrade

South Kensington and Elephant & Castle top the pipeline list
2 days ago

Corbyn Plant Hire fleet goes under the hammer

Kit to be sold off by sister firm to collapsed groundworks contractor
2 days ago

Government wields procurement stick on late payment

New rules would block slow payers from bidding on big public jobs
5 days ago

Hercules buys power line labour firm for £15.7m

Labour supply specialist snaps up Advantage NRG to tap booming electricity upgrade market
5 days ago

Universal bid to fast-track planning for theme park

Entertainment giant eyes 2026 start at Bedford site
5 days ago

Developer Breck to transform former Ibstock brick factory

Ravenhead works to become 300-home development
5 days ago

SP Energy Networks awards contracts worth £1.4bn

First round of awards under £5.4bn national electricity grid upgrade programme
6 days ago

Travelodge to convert Liverpool Street office building

Office-to-hotel conversion in City of London
5 days ago

Plans lodged for 1m sq ft City of London office

Barbican landmark building will reuse 40% of existing structure
6 days ago

PTSG acquires roofing specialist HD Sharman Group

Premier Technical Services Group expands building maintenance division
5 days ago

Balfour Beatty lands £833m carbon capture power plant job

Work to start later this year on Teesside carbon capture gas-fired power station
6 days ago

Svella agrees deal to save Cubby Construction

Solvent purchase set to save 214 jobs and protect supply chain
6 days ago

J Coffey holds line on margins despite £52m revenue slide

Pre-tax profit down 14% but firm eyes strong pipeline to bounce back
6 days ago

Consultants called up for £2.3bn NHS SBS panel reboot

Market asked for views ahead of next-gen procurement rollout
6 days ago

Hochtief launches new UK data centre division

German business model to be introduced for UK construction
7 days ago

Construction skills body launches with 100,000 worker target

Industry to work closer with Jobcentres to find new talent
6 days ago