June 3, 2014
Commercial property helps fuel rise in number of new construction projects
Construction growth in the three months to June was at its highest peak since the start of the year, driven by a renewed strengthening of non-residential properties, according to new figures from industry analysts Glenigan. Following reports from the Confederation of British Industry (CBI) that the economy is growing at its fastest pace since its records began in 2003,the Glenigan Index, which covers the value of projects starting in the UK over the previous three months, is 20 per cent higher than a year ago. Its non-residential index is up by 24 per cent compared to the same period in 2013, the strongest rate of growth seen since the three months to January of this year; largely fuelled by the private sector, with the industrial, office and hotel and leisure sectors all seeing healthy improvements.
Education and health starts also rose, while underlying civil engineering starts rose by 38 per cent in the latest period. Work continues to rise across both the infrastructure and utilities sectors, which saw starts up by 29 per cent and 50 per cent respectively compared to 2013.
Allan Wilén, Economics Director at Glenigan, said: “As we head towards the mid-point of 2014, the prospects are improving for construction volumes across the whole of the UK.
“A renewed strengthening of non-residential work is the most significant driver of the high 20 per cent increase recorded in our latest Index, though the underlying value of project starts also increased across the housing and infrastructure sectors.”
He added: “The flow of non-residential development showed a pause in the first quarter of 2014, with a modest 1 per cent rise in the value of starts. This came as the rate of growth slowed in commercial work, remaining just sufficient to offset weakness in public sector construction.
“However the latest figures show a renewed expansion in the underlying value of starts.”