GRAHAM has surpassed the £1bn turnover milestone for the second consecutive year as revenue increased to £1.125bn. The headline figure from recently published accounts (year ending 31st March 2024) is a 2.8% increase on the Group’s 2023 results (£1,093.7bn). The leading national contractor and developer also recorded profit before tax
Greystar, a global leader in rental housing property management, development, and investment, celebrated the structural completion of its Purpose-Built Student Accommodation (PBSA) scheme in Wembley with a topping out ceremony organised by construction partners McAleer & Rushe, and attended by senior representatives from Brent Council and the Greater London Authority.
Aldi, the popular supermarket retailer, has unveiled its latest plans to expand its footprint across the UK, aiming to achieve its long-term target of 1,500 stores. Currently operating over 1,020 stores, Aldi is actively seeking new locations to ensure high-quality food is accessible to all. In a bid to identify
GMI Construction Group has completed the £24m Pershore Junction purpose-built student accommodation in Birmingham on schedule – with rooms already being reserved ready for Autumn term. The 167 bed state-of-the-art development in the suburb of Stirchley consists of 101 studios and also features a student hub, communal spaces and enhanced
The approved mixed-use residential development will be Forshaw Group’s largest residential scheme to date and will include 224 open market apartments, an aparthotel and coffee bar on a key gateway site into Manchester. Manchester City Council have approved plans submitted by Forshaw Land & Property Group to transform a vacant
Ahead of this week’s UK election, we’ve highlighted four key areas the next Government needs to act on to ‘stimulate and sustain’ the national workplace and facilities management (WFM) profession and sector. The ‘Priorities for the next Government: 2024 general election manifesto’ publication highlights the challenges faced by the next
General Election market uncertainty contributes to a slower market says Lismore’s Chris Macfarlane On the eve of the 2024 General Election, leading independent property advisory firm, Lismore Real Estate Advisors has published the latest figures on the commercial property market in Scotland for quarter two of 2024. Transaction volumes totalled
Osprey Charging, the UK’s leading and fastest growing public EV rapid-charging network, recently conducted an eye-opening experiment which saw children aged 7-14 have their visions of the future brought to life by an AI artist. Asked to describe what they think the future holds for humanity, the children offered fascinating
Today, Glenigan, one of the construction industry’s leading insight and intelligence experts, releases its widely anticipated UK Construction Industry Forecast 2024-2026. The key takeaway from this Forecast, which focuses on the next three years (2024-2026), is that the construction industry will face near-term challenges including weak economic growth, high interest
Balfour Beatty, the international infrastructure group, has announced that Nick Crossfield will join the Group later this year as CEO of its UK Construction Services business. Nick will be responsible for the strategic leadership of Balfour Beatty’s UK Construction Services business, delivering on its business plans with a focus on further
BDC 318 : Jul 2024
GRAHAM has surpassed the £1bn turnover milestone for the second consecutive year as revenue increased to £1.125bn. The headline figure from recently published accounts (year ending 31st March 2024) is a 2.8% increase on the Group’s 2023 results (£1,093.7bn). The leading national contractor and developer also recorded profit before tax of £14.8m and maintained its robust balance sheet position with cash at bank and in hand of £151m. This “strong performance” in the face of well documented inflationary pressures and significant economic and geopolitical headwinds followed the successful delivery of major projects in each of its core market sectors (building, civil engineering, interior fit-out, facilities management and development management). Across the wider industry, higher borrowing costs and the evolving regulatory and legislative environments have led to a slow down in planned start dates for major construction projects while impacting upon contractor profitability. To offset many of these challenges, the Group has focussed on a sustainable growth model built on the platform of strategic supply chain management and selective work winning. This approach has resulted in a record pipeline of secured work in excess of £2bn. Commenting on the latest accounts, Andrew Bill, GRAHAM Group Chief Executive Officer, said: “The latest published accounts for the Group are pleasing and underline the strong performance of each our divisions within our core market sectors. We prioritise robust governance and commercial management which are the backbone of our sustainable growth model. Significantly, the continued success of the Group has been achieved despite global economic uncertainty and inflationary pressures. The market has been challenging but our consistent focus on quality delivery and commitment to securing repeat business through the development of collaborative client relationships have allowed us to grow sustainably over the past year. Looking forward, we have developed a significant pipeline of opportunity to allow us to positively approach the next 12 months, and beyond, with energy and optimism.” Breadth of delivery The scale, scope and variety of GRAHAM’s national portfolio have been central to its continued strong financial performance. Projects such as Candleriggs, a 346 unit Build to Rent development in Glasgow (£81.5m), improvement works to the M25 Junction 28 in Essex (£154m), the interior fit-out of BT’s new 76,000 sq. ft. offices in Dundee and the restoration of the historic Cathays Grade II Listed Library for Cardiff Council underline the breadth of its expertise. At Lord’s Cricket Ground, the iconic home of cricket, the company has also been named as the preferred bidder for an iconic redevelopment project encompassing the Tavern and Allen Stands, while it recently secured planning consent for a transformative regeneration project at Meadowbank in Edinburgh that will see the development of over 700 much-needed homes – over 35% of which will be affordable – across a five-hectare site that will create one of the city’s “greenest neighbourhoods”. Environmental, Social and Governance Beyond the balance sheet figures, GRAHAM’s track record for “delivering lasting impact” is evidenced in the £538.4m Social Return on Investment (SROI) it has delivered for communities across the UK and Ireland. As a responsible, sustainable business, the Group’s drive to Net Zero has also resulted in a 19% absolute reduction in Scope 1 and 2 carbon emissions and the achievement of a 98% rate for the diversion of construction waste from landfill. GRAHAM continues to make substantial investments in the skills and development of its people and supply chain with a robust training program that provides five days of training per person each year. Notably, GRAHAM was the first UK organisation to achieve Investors in People (IIP) “We invest in Wellbeing Platinum” status this year. Additionally, IIP reaccredited GRAHAM with “We invest in People Platinum” for the third time—an achievement attained by only 5% of organisations across all industries. Most recently, GRAHAM earned the “Investor in Diversity Gold” award and secured the 29th position among the Top 100 Equality, Diversity, and Inclusion companies in the UK. Attributing the continued success of the business to the concerted efforts of the 2,500-strong workforce, Andrew, added: “The ongoing growth of GRAHAM is due to the hard work and dedication of our people, both on site and those in central support services. Individually and collectively they embody ‘The GRAHAM Way’ which is the unique culture that sets us apart. On a daily basis they continue to build lasting relationships with clients, innovate in our approach to delivery, and strive for excellence, which, as a package, is the bedrock behind the strong financial figures published within these latest accounts.” For more information on GRAHAM, please visit: www.graham.co.uk Building, Design & Construction Magazine | The Choice of Industry Professionals
Greystar, a global leader in rental housing property management, development, and investment, celebrated the structural completion of its Purpose-Built Student Accommodation (PBSA) scheme in Wembley with a topping out ceremony organised by construction partners McAleer & Rushe, and attended by senior representatives from Brent Council and the Greater London Authority. The Canvas Wembley site, Greystar’s first ground-up PBSA asset under the Canvas brand, will consist of 770 beds and is strategically located close to transport links (four-minute walk to Wembley Park tube station), providing access direct to central London, and near the iconic Wembley Stadium. Set within the North East Lands development, the site is part of a 12-acre district that will ultimately deliver 2,347 residential units of varying tenures next to the biodiverse seven-acre Union Park. Wembley Park is now an established neighbourhood, and an increasingly popular environment for students to live. The well-amenitised scheme will feature two lounges, co-working spaces, as well as a café, activity space, library, gym, yoga studio and private dining areas. The Canvas brand is all about creating a lifestyle that matches the needs of its residents, and students will be invited to partake in a full annual calendar of events, as well as gain access to the innovative Canvas app which offers a convenient home for maintenance and parcel services, exclusive offers and promotions. A comprehensive wellbeing programme including events, talks, and a Student Assistance Programme will also be available to those enrolled in partnership with university stakeholders. In a significant step towards sustainable finance, Greystar entered into its first Green Loan in the UK, to acquire the site from Quintain in April 2023. The financing underscores Greystar’s commitment to delivering an environmentally responsible and sustainable building, ensuring that the project adheres to the highest standards of ESG criteria. The scheme will be all-electric to reduce its carbon footprint, connected to the District Heat Network to provide efficient heating solutions, and equipped with roof PV panels. Construction Partners, McAleer & Rushe are delivering the scheme as a Whole Life Carbon Assessed project, achieving a LETI A rating for the building structure and is on track to achieve its 500kgc02e/m2 (A1-A5) embodied carbon target upon completion. Ben Mowbray, Managing Director- UK Student Investment, Greystar, said: “London is a highly attractive market for student accommodation investment, facing a scarcity of high-quality options despite its status as one of the top global capital cities for students. This is a significant milestone in the growth of our Canvas brand in the UK, and we were delighted to mark the occasion with Brent Council, who have been an important partner in the delivery of the scheme. Canvas Wembley is set to transform the student accommodation landscape in Wembley Park, offering a modern, sustainable living environment for students that supports both their academic journey and personal growth.“ Mark Allnutt, Executive Director, Europe, Greystar, said: “We look forward to completing the fit out of Canvas Wembley and welcoming our first students for the 2025 academic year. The project forms part of our wider strategy to increase our UK student accommodation footprint and develop new supply in a market characterised by acute shortages. We are constantly on the lookout for well-located, brownfield sites to develop high-quality, purpose-built accommodation from the ground-up.” Darragh Greenan, Contracts Director, McAleer & Rushe, adds: “We are delighted to be delivering this landmark PBSA project for Greystar and to contribute further to the ongoing transformation of Wembley Park. Over the last 8 years, we’ve built a strong and meaningful relationship with the community and look forward to continuing to collaborate with Brent Council to promote local employment opportunities. NE01 showcases the significant efforts our business is driving to reduce embodied carbon, with focuses on innovative efficiencies within the concrete frame and maximising offsite fabrication. We’re on track to exceed our Sustainability targets on NE01, underscoring our commitment to delivering our projects safely and sustainably.” Building, Design & Construction Magazine | The Choice of Industry Professionals
Aldi, the popular supermarket retailer, has unveiled its latest plans to expand its footprint across the UK, aiming to achieve its long-term target of 1,500 stores. Currently operating over 1,020 stores, Aldi is actively seeking new locations to ensure high-quality food is accessible to all. In a bid to identify optimal sites for upcoming store launches, Aldi launched a nationwide campaign in May 2024, inviting the public to suggest priority locations. The response was overwhelming, with thousands of requests pouring in from across the country. After carefully reviewing these suggestions, Aldi has updated its list of priority locations for new stores. The retailer is now targeting a variety of areas, including multiple sites in London such as Woodford, Surbiton, South Croydon, Notting Hill, Walthamstow, Beckenham, Bromley, and Barnet. Other targeted locations include Redhill in Surrey, Aldershot in Hampshire, Haywards Heath and Burgess Hill in West Sussex, Chatham in Kent, Cheadle and Chorlton in Greater Manchester, Formby in Liverpool, Newark in Nottinghamshire, Chesterfield in Derbyshire, Wellingborough in Northamptonshire, Rayleigh and Brentwood in Essex, Dorchester in Dorset, Clarkston and Cathcart in Glasgow, Penzance in Cornwall, Warwick in Warwickshire, and Bath in Somerset. Additionally, Aldi has identified over 100 potential sites within the M25 motorway and another 100 locations in the wider South East region where there is significant demand for new stores. Aldi’s expansion strategy includes both its standard stores and the smaller Aldi Local format, which caters to urban areas within the M25 with a size of around 5,000 square feet. Jonathan Neale, Aldi UK’s Managing Director of National Real Estate, emphasised the retailer’s commitment to accessibility: “We want to make high-quality food accessible to all, but we can’t do that while there are still some towns and areas that either don’t have an Aldi or have capacity for additional stores. We recognise there is huge demand in certain regions for more stores, which is why we decided to get the public’s input on our latest list of priority locations. They have helped us identify where demand is greatest, and we will continue to work to bring Aldi to as many people as possible.” To accommodate its expansion, Aldi is seeking sites that can host a 20,000 square foot store with around 100 parking spaces, ideally located near main roads with good visibility and access. This aggressive growth plan is supported by Aldi’s substantial investment strategy, which includes over £550 million allocated to its store and distribution network throughout 2024. This investment will fund the opening of new stores and the enhancement of existing locations and distribution centres. As Aldi continues its rapid expansion, it aims to meet the growing demand for its high-quality, affordable products across the UK. By engaging with the public and strategically selecting new locations, Aldi is well on its way to achieving its ambitious target, ensuring more communities benefit from the Aldi shopping experience. Building, Design & Construction Magazine | The Choice of Industry Professionals
GMI Construction Group has completed the £24m Pershore Junction purpose-built student accommodation in Birmingham on schedule – with rooms already being reserved ready for Autumn term. The 167 bed state-of-the-art development in the suburb of Stirchley consists of 101 studios and also features a student hub, communal spaces and enhanced retail space. Led by specialist student developer Alumno, the vibrant living space is ideally located for the city’s universities, together with Birmingham’s School of Dentistry. A launch event marking its completion was hosted by Alumno and was attended by the delivery team and key stakeholders. It also coincided with an Alumno-sponsored Birmingham student photography competition and exhibition organised by Photo North which featured a series of talks by notable photographers. Designed by Birmingham-based Howells, the Woh Hup-funded scheme incorporates brickwork and terracotta detailing that reflects the area’s architectural heritage while also providing the building with a distinct identity. A highlight of the development is an interior poetry garden, a unique and peaceful social space created in collaboration with Birmingham Poet Laureate Casey Bailey and Writing West Midlands. The garden includes landscaping, seating, and cycle stands. Situated at the intersection of Dogpool Lane and Pershore Road, Pershore Junction has successfully transformed the former BT brownfield site and its completion strengthens Alumno’s successful partnership with GMI Construction Group, which recently delivered the nine-storey Church Inn student scheme in Manchester and the Terry Frost Building, a 411-bed student accommodation, in Leeds. David Campbell, Alumno Managing Director said: “It is wonderful to see this dynamic building come to life and provide accommodation for Birmingham’s expanding student population. Working with the local authority and community was integral to the buildings’ success and it has re-energised the overlooked site to offer a unique student experience and enhance this vibrant university town.” Gareth Jones, GMI Construction’s Divisional Managing Director in the Midlands, said: “We are delighted to see Pershore Junction completed, which will help tackle the shortfall in high-quality student accommodation in the city. This development underscores GMI’s expertise in constructing multi-occupancy buildings, particularly in the student sector, and highlights our ongoing successful partnership with Alumno.” Philip Johnson, Head of Investment at Woh Hup, added: “We are delighted to launch this new property at Pershore Junction to add to our existing portfolio of more than a thousand student beds in the UK. “We are extremely grateful to the Alumno and GMI teams for their support in delivering a best-in-class building and look forward to welcoming students in September. We continue to look for further development and funding opportunities around the Selly Oak and adjacent areas.” Alan McCartney, Partner at Howells, said: “Pershore Junction contributes appropriately to the ongoing transformation of Stirchley, with the design delivering a contemporarily crafted brick and terracotta building, which remains clearly of its place. “Stirchley is a fantastic part of Birmingham and the quality the whole team have been able to deliver will serve to set the benchmark for new buildings coming forward in the area.” Building, Design & Construction Magazine | The Choice of Industry Professionals
The approved mixed-use residential development will be Forshaw Group’s largest residential scheme to date and will include 224 open market apartments, an aparthotel and coffee bar on a key gateway site into Manchester. Manchester City Council have approved plans submitted by Forshaw Land & Property Group to transform a vacant brownfield site at Cornbrook into a high-quality, mixed-use residential and commercial scheme. The collaboration between the Bolton based developer and waterside regeneration specialists Peel Waters will see the 1-acre plot which sits adjacent to VOX Manchester and the Cornbrook Metrolink station, turn into a key landmark site for both the city centre and the emerging Manchester Waters district. The approved 24-storey development will consist of 224 one-, two- and three-bedroom apartments and five, two- three- and four-bedroom penthouse apartments with private terraces. Spaces to play, socialise and connect with fellow neighbours have been thoughtfully designed into the scheme, with the inclusion of a games room, communal coworking spaces, private dining room, yoga studio and a residents’ gym. Community building and socialising will be further enhanced by the ground floor retail spaces which will be used for further amenity space and an independent coffee bar, providing a convenient space and service for Manchester Waters residents, workers, commuters, and visitors on their way to-and-from the city. Also included within the approved plans is a four-storey, 87 room apart-hotel, which will be part of Forshaw Group’s new ‘Vivere’ brand collection. Located between Manchester City Centre and Old Trafford, the site offers a desirable location and further rooms to meet demand for Greater Manchester’s growing visitor economy. Leach Rhodes Walker have been instructed as the architects on the project and have taken design influence for the development from the historical industrial context of the site. The proposed creation of this high-quality gateway building will mark the arrival point into the City and Manchester Waters, whilst complementing the other new buildings close to the site. Lyndon Forshaw, CEO, Forshaw Group said: “We are very pleased our plans have been approved by Manchester City Council. “Our approved scheme sits on a hugely important gateway site and we are looking forward to continue working closely with Peel Waters to create a development that delivers on the ambitions of the Cornbrook Regeneration Framework. “This will be our largest residential led scheme to date and we are excited to deliver much needed new housing as well as launching our first hotel under our new Vivere Aparthotel brand.” Forshaw’s development will form part of the wider Manchester Waters masterplan which has been designed by Peel Waters to regenerate the brownfield site and bring much needed quality homes and amenities to the area. James Whittaker, Managing Director, Peel Waters added: “After years of acquiring the land and securing outline planning permission for the Cornbrook Hub, it is fantastic to see detailed planning permission being granted for another development at Manchester Waters. “Our long-term vision for the wider Manchester Waters neighbourhood is to create a vibrant and sustainable waterside community, offering a mix of tenures in one of the most desirable waterfront locations in Greater Manchester. “Forshaw Group’s approved plans will further enhance our vision and we now look forward to seeing the delivery of this development.” Manchester Waters is part of Peel Waters, a UK wide portfolio of vibrant and innovative, waterfront developments, delivering large-scale, sustainable regeneration projects, creating jobs, economic growth, new homes and new public realm across the country. Building, Design & Construction Magazine | The Choice of Industry Professionals
Ahead of this week’s UK election, we’ve highlighted four key areas the next Government needs to act on to ‘stimulate and sustain’ the national workplace and facilities management (WFM) profession and sector. The ‘Priorities for the next Government: 2024 general election manifesto’ publication highlights the challenges faced by the next Government, including economic malaise, decarbonising the country’s infrastructure and habits, investing in education and health, all in a challenging and persistent negative fiscal environment. The publication also details how WFM is a major contributor to the UK economy; for instance, outsourced sector/service providers represent about 5% of all UK enterprises, of which 250 key WFM enterprises had a turnover of £50 million or more each. Drawing on recent research, IWFM’s Market Outlook Survey 2024 report, five major priorities emerged for our members: 1. Focus on growing the economy 2. Develop a coherent plan to achieve net zero 3. Reduce uncertainly around government policy 4. Provide support to people to help with the cost of living 5. Develop an overarching skills strategy / make it easier to recruit talent from outside the UK / encourage staff back to offices in town centres / reduce business taxes. We identified four key areas to realise these priorities, all of which are cross cutting to a degree: skills; sustainability; building safety; information management, data and technology. Our Head of Policy & Research, Sofie Hooper, said, ‘Along with the UK at large, WFM as a profession and sector are facing seismic challenges which threaten their prospects. However, their contribution represents a huge source of value across broad areas: increasing organisational productivity and providing workplace wellbeing, delivering net zero and mitigating climate change across our buildings, delivering safe homes and providing the right information to the right people at the right time. ‘Fortunately, actionable steps can be taken to address immediate issues and get match fit for future conditions. IWFM calls on the next UK Government to act on this publication and the many resources we’ve created to enhance our sector and profession.’ Building, Design & Construction Magazine | The Choice of Industry Professionals
General Election market uncertainty contributes to a slower market says Lismore’s Chris Macfarlane On the eve of the 2024 General Election, leading independent property advisory firm, Lismore Real Estate Advisors has published the latest figures on the commercial property market in Scotland for quarter two of 2024. Transaction volumes totalled £272 million, down 15% on Q2 2023 and 31% below the 5-year average. A smaller number of larger ticket sales, combined with continued uncertainty in the market over the timing of future interest rate cuts and the impending General Election have affected transaction volumes. The largest deal of the quarter was the £45.8 million acquisition of 1 West Regent Street in Glasgow, by Corum Asset Management, followed by Remake Asset Management’s £36.6 million acquisition of HQ buildings, 2 Greenmarket in Dundee and 4 Pacific Quay in Glasgow, let to BT and STV respectively from LondonMetric. Other noteworthy transactions include Ropemaker Properties £14.725 million sale of four prime industrial units at Fullarton Drive in Cambuslang to clients of Ediston and the £23.5 million off-market sale of Malmaison at St Andrew Square in Edinburgh by Associated British Foods to clients of Patrizia. Logistics and multi-let industrials continue to see strong demand, with prime yields around 6%. Office yields are improving, while retail parks offer compelling value with 6.50-7.00% yields. High street properties in prime locations and living sector investments remain attractive and prime BTR and PBSA yields are stable at 5.00-5.50%. Lismore Director Chris Macfarlane said: “Despite a slower than anticipated quarter, buyer-seller standoffs are easing, with increased buyer activity and momentum improving. “Fund activity remains selective and quite opportunistic, focusing on living and logistics sectors, with retail warehousing gaining interest. Core-plus buyers may benefit from potential interest rate reductions, whilst private equity shows interest in pressured sales and good-value, long-leased stock, indicating less distress than expected and expanding their investment scope. “We anticipate that the expected interest rate cuts by autumn may improve debt terms, although development continues to be hindered by stubbornly high build costs and uncertain exit pricing. “Amid the General Election, we hope the victor fosters optimism, creating a business-friendly environment for sustained economic growth. Effective governance is crucial for job creation, economic prosperity, and social well-being. Change brings opportunity; let’s hope for competent leadership to drive our future forward.” Building, Design & Construction Magazine | The Choice of Industry Professionals
Osprey Charging, the UK’s leading and fastest growing public EV rapid-charging network, recently conducted an eye-opening experiment which saw children aged 7-14 have their visions of the future brought to life by an AI artist. Asked to describe what they think the future holds for humanity, the children offered fascinating yet startling ideas on how they envisage the future, and were astounded as these were projected back to them via AI. The children’s initial hopes centred around the advanced use of technology and a sense of community, but their expectations presented a different image of the future. This comprised images of a heavily polluted sky, artificial greenery and visions of the sick struggling to walk, all as a result of the unchallenged use of fossil fuels and carbon emissions. As these visceral images were projected on to a screen behind them, the children were shocked at the visualisation of the harsh landscapes that they had described. Conversely, as they explained their dream futures, the AI image generator simultaneously projected these wonderfully vivid and hopeful visions of future societies, demonstrating a more optimistic outlook of what could be possible, with images of vibrant nature, clean air and innovative transportation. In response to these images, the children involved outlined how they believe positive action to reduce carbon emissions, utilising green energy and driving electric vehicles can help us protect and improve the world around us. Many of the participants highlighted the need for action to be taken now, to avoid a cycle of missed opportunities to preserve our environment. Ian Johnston, CEO of Osprey Charging, commented: “It has been incredibly eye-opening and insightful to hear the thoughts, hopes and fears of our next generation on what they believe lies in store for our society and environment, and the stark visualisation using AI generated images cements the need for action to be taken to support the move to net zero. Here at Osprey Charging, we’re continuing to be at the forefront of this transition, installing increasing numbers of public EV chargers across the UK, with over 1,000 rapid chargers now available on the Osprey network, in a range of accessible rural and urban locations. “This experiment and the engaging input from each child that participated highlighted the necessity for both businesses and individuals to continuously strive for greater green and sustainable practices, something which we pride ourselves on. Through installing charging infrastructure, powered by renewable energy, from Land’s End to John O’Groats and across Great Britain, we are providing the critical infrastructure that is supporting the UK’s transition to electric vehicles” Osprey’s network of chargers has an outstanding reliability rate of 99%, and in the last twelve months Osprey was awarded Charging Network of the Year at the Electric Vehicle Innovation and Excellent awards and Best EV Charging Network at the Transport and Energy Awards. Furthermore Osprey’s easy charging experience saw the network recognised as a ‘Driver Recommended Network’ by Zap-Map for the fourth year running. Building, Design & Construction Magazine | The Choice of Industry Professionals
Today, Glenigan, one of the construction industry’s leading insight and intelligence experts, releases its widely anticipated UK Construction Industry Forecast 2024-2026. The key takeaway from this Forecast, which focuses on the next three years (2024-2026), is that the construction industry will face near-term challenges including weak economic growth, high interest rates, and disruptions caused by the General Election. These factors are expected to further constrain private-sector investment and delay public-sector projects. However, the outlook brightens over the forecast period. The early election will reduce political uncertainty, while a strengthening economy is expected to boost consumer and business confidence from H2 2024. This signals recovery in the not-so-distant future, with a modest increase in project-starts predicted in the latter half of 2024 lifting starts by 3% this year. As the economy picks up further in 2025, Glenigan forecasts 7% growth, and 6% in 2026. Disruption stifles short-term growth Construction starts have remained sluggish during the first six months of 2024, as high interest rates and a weak economic outlook dented investor and consumer confidence. The General Election has also affected the pipeline of public-sector construction projects. The purdah period has disrupted the progress of public-funded projects, while decisions will also be delayed post-election as the new government reviews existing programmes such as the Lower Thames Crossing. Starts on the up However, an easing in borrowing costs and improved economic conditions – with the UK economy forecast to grow around 0.8% in 2024 – together with greater political certainty, should help to lift investor confidence from the second half of 2024 and into next year. Despite a tough start, renewed growth in project-starts is forecast for H2 2024. The gradual easing of interest rates is also expected to feed through to lift housing market activity from the second half of this year. Further, the Spending Review will set out the new government’s funding commitments and priorities and is expected to strengthen public sector construction activity during the second half of the forecast period. Commenting on the Forecast, Glenigan’s Economic Director Allan Wilen says, “The UK construction sector is still facing significant headwinds as the economy struggles to pick back up. However, there are signs of growth in several key areas, particularly in the private verticals, signalling a gradual recovery from mid-2024. In the private housing sector, for example, we anticipate starts will pick up in the latter half of this year, driven by improved affordability and brighter economic prospects. “Similarly, we’re forecasting improved activity in consumer-related verticals such as retail and hotel & leisure, as a gradual easing in price inflation is set to provide a boost to households’ spending power. Elsewhere, structural changes are expected to create new opportunities in office refurb and fit-out, while logistics is poised for renewed investment fuelled by online retail growth. However, he acknowledges the upcoming General Election will have a significant upfront impact on industry performance, particularly in the public sector, “Public-funded investment is expected to stagnate in the near term. The election has disrupted the progress of many projects, with the purdah period leading up to the 4th of July preventing civil servants from making any announcements that could influence voting intentions. As a result, decisions will be delayed until post-election. For example, the Department for Transport has already announced that ministerial decisions on several major projects, including the Lower Thames Crossing, have been pushed back by six months. This means we’ll have to wait until the new Government’s Spending Review for further clarity on budget allocation, and this might not be until Q.4 2024.” Taking a deeper dive into sector verticals… Private housing set to rebound Housing market activity fell sharply in 2023, with the value of project-starts dipping 11% as housebuilders reacted to weakening market conditions and more stringent building regulations. Private housing starts are predicted to experience slow growth over the forecast period, with Glenigan predicting a 2% rise in 2024 as the market environment gradually picks up. An increase in mortgage approvals in March 2024 (the highest in 18 months) points to a strengthening in house sales in the coming months. Renewed project-starts recovery is also anticipated in the second half of the forecast period, rising 14% in 2025 and 6% in 2026, as interest rates dip and consumer confidence improves. Social housing stabilises The forecast for social housing is mixed, with starts predicted to experience modest growth over the next three years, with a slight dip in 2025. Greater stabilisation to previously eye-watering construction materials costs in 2024 is expected to boost the sector, with a 4% rise forecast for 2024. Student accommodation starts are expected to stagnate significantly over the forecast period, due to the government’s visa restrictions on graduate schemes which will likely weaken demand for purpose-built student accommodation. Having been a key driver of sector growth in 2023, this is anticipated to slow down sector recovery. Glenigan is forecasting a slight decline (-1%) in 2025, however, increased government funding for social housing provision, a major political priority, is expected to lift starts by 7% in 2026. Slightly brighter outlook for industrial The industrial sector is experiencing a period of consolidation following a boom post-pandemic, largely driven by significant growth in warehousing and light industrial projects. Looking forward, industrial project-starts are expected to remain weak for the rest of the year, before returning to growth in 2025. A decline in consumer spending caused the online retail market to lose momentum, tempering the demand for logistics space. Meanwhile, manufacturing output has also been subdued, limiting investment in facilities. Nevertheless, as the economic outlook and household finances improve, the sector should see renewed growth fuelled by the demand for warehousing and logistics. Consequently, Glenigan is forecasting a 3% growth in 2025, and 4% in 2026. Utilities to boost civil engineering A sustained rise in civil engineering starts is anticipated over the next three years, driven by an increase in utilities projects as energy and water companies roll out planned investments. Overall, civil engineering starts are forecast to grow
Balfour Beatty, the international infrastructure group, has announced that Nick Crossfield will join the Group later this year as CEO of its UK Construction Services business. Nick will be responsible for the strategic leadership of Balfour Beatty’s UK Construction Services business, delivering on its business plans with a focus on further developing its presence in the growing infrastructure market – including the energy, defence and sustainable transportation sectors – as the partner of choice for notable customers and clients such as SCAPE, the Environment Agency, the NHS and Rolls Royce, as well as local authorities. Nick will sit on the Executive Committee and report directly into Group Chief Executive, Leo Quinn. Having studied Mechanical Engineering at Reading University, Nick has over 40 years’ experience within the industrial and engineering industries, starting his career as a graduate with BAE Systems, and going on to work with British Steel, Network Rail, and Siemens. Currently Nick is the Managing Director of Alstom Transportation’s UK and Ireland business, a role he has held since 2015. Leo Quinn, Balfour Beatty Group Chief Executive Officer, said: “I am delighted to welcome Nick to Balfour Beatty. “He brings with him a wealth of experience working directly with Government on behalf of industry, as well as a strong track record of managing large businesses, successfully delivering sustainable profitable growth, and navigating highly regulated environments with a focus on driving operational improvements. His experience and understanding of the markets in which Balfour Beatty operates makes him perfectly positioned to lead our UK Construction Services business.” Commenting on his appointment, Nick Crossfield said, “I very much look forward to joining Balfour Beatty. I have watched with interest over the last ten years as the Group has continued to position and win work in its core markets and I look forward to continuing the successful delivery of national and local infrastructure across the UK”. Balfour Beatty’s UK Construction Services business consists of three business units: Scotland, Buildings – responsible for the delivery of construction projects in the aviation, health, defence, education and development sectors in England, and Civils – responsible for delivering civil engineering projects across the transportation (highways, public realm, and rail), flood and coastal defence, and industrial and energy sectors in England. As well as specialist brands Balfour Beatty Living Places, Balvac and Balfour Beatty Homes Building, Design & Construction Magazine | The Choice of Industry Professionals
