The latest research by Zero Deposit, the tenancy deposit alternative, has revealed that London remains the most competitive region for letting agents, having seen the largest increase in the number of residential letting agents in the last year, while London letting agents also have the highest average number of current
Travelodge, the UK’s first budget hotel brand which operates nearly 600 hotels across the UK, Ireland and Spain, today announces it has promoted and appointed Kirsty Berry as the Company’s new Head of Estates. Kirsty joined Travelodge in 2022 as Regional Estates Manager and has been an integral member of
A major event for the South West construction industry brought together 150 industry leaders and professionals to shine a light on major challenges facing the sector. Attendees gathered at the Future Skills Centre in Exeter for the Constructing Excellence South West Construction and Housing Summit and participated in an exclusive
Construction company placed in administration after workers given ‘no notice’ Unite the union recently confirmed on Friday 12th of December that it is to hold meetings in Aberdeen and Dundee today following the announcement that the Stewart Milne Group has been placed into administration. Unite stated this week that it
Provider of powerful AI-based water management systems elevates expectations entering 2024 As organizations around the world face rising costs related to water damage and increased focus on water sustainability, WINT Water Intelligence is building on its success in 2023 to continue solving these challenges for insurance, construction, facilities, and property
One the most significant and sustainable urban expansions of Edinburgh in a generation is a step closer to reality following the submission of a major planning application to the City of Edinburgh Council (CEC). West Town Edinburgh Limited, the development consortium headed by Drum Property Group which owns more than
A host of new features, interactive demos, international pavilions from across the globe, and a charity Gumball Rally across the country have all been announced by the organisers of the UK’s largest event for the built environment, UK Construction Week (UKCW), which makes a welcome return to London’s ExCeL from
Engineers this week began a delicate job that will see almost half a kilometre of bridge deck slid into position over the next year, high above the Misbourne Valley in Buckinghamshire, as HS2’s innovative Wendover Dean Viaduct enters a critical new stage of construction. The 450m-long viaduct will be the
To advance the UK’s journey toward achieving net zero, Energy & Utility Skills is proud to announce the establishment of the Power Generation Group within the National Skills Academy for Power (NSAP). This initiative strategically aligns with the needs of the renewable sector within the power generation industry. Power generation
Lending for commercial construction is expected to fall for the ninth year in a row, underlying how demand for office space and high street retail has declined over the period. The analysis comes from specialist property lending experts, Octane Capital, which compared lending levels across different areas of the property
The latest research by Zero Deposit, the tenancy deposit alternative, has revealed that London remains the most competitive region for letting agents, having seen the largest increase in the number of residential letting agents in the last year, while London letting agents also have the highest average number of current rental listings on the books versus every other region of Britain. Zero Deposit analysed the number of residential letting agents across each region of Britain*, before looking at current rental market stock levels in each region* to determine where letting agents are having the busiest start to 2024 when it comes to available rental market stock. The research shows that there are some 24,237 residential letting agents operating across Britain today. This number has increased by 3% year on year, with 601 more letting agents operating across the market versus January last year. With 132,723 rental properties currently listed for rent, that equates to an average of five available properties per letting agent. London, along with Wales, has seen the largest increase in letting agent numbers, up 4% year on year. However, this 4% increase is far greater in the capital, where it equates to an additional 232 letting agents, versus an increase of just 36 in Wales. As a result, London remains the most competitive market for letting agents, with a total of 6,189 in business across the capital, by far the most of any region, with the South East sitting second with 3,967. However, the research by Zero Deposit suggests that the London rental market is most in need of this year on year boost to letting agent numbers. There are currently almost 50,000 homes listed for rent across the capital, with again just the South East coming close to this level of rental market stock with 20,574 current listings. As a result, the figures from Zero Deposit show that each of London’s 6,189 residential letting agents currently hold an average of eight available rental properties in the current market. The East Midlands sits second in this respect, with the average agent currently listing seven rental properties, with the West Midlands and Yorkshire and the Humber following with six and the South East completing the top 10 with five. Sam Reynolds, CEO of Zero Deposit commented: “Demand for rental homes remains high and we’ve seen the number of letting agents operating across Britain increase across the board in order to help service this demand. London certainly remains the heart of the lettings market in this respect, with the capital not only home to the largest number of letting agents, but having also seen the largest increase in transaction numbers. London’s letting agents have also had the busiest start to the year, currently listing the highest average number of available rental properties per agent of all regions of Britain. Of course, this doesn’t take into account the resource requirements related to the ongoing management of these rental properties and they remain a vital cog in the machine of the nation’s rental market.” Data tables and sources: – Data tables and sources can be viewed online, here. Building, Design & Construction Magazine | The Choice of Industry Professionals
Travelodge, the UK’s first budget hotel brand which operates nearly 600 hotels across the UK, Ireland and Spain, today announces it has promoted and appointed Kirsty Berry as the Company’s new Head of Estates. Kirsty joined Travelodge in 2022 as Regional Estates Manager and has been an integral member of the UK Estates team since. With a background consisting of a vast range of property experience with a number of multi-site businesses including Domino’s UK and Majestic Wines, Kirsty has been crucially involved in various sublet deals and lease regears. This includes leading a unique sublet agreement for one of the UK’s first Popeyes Louisiana Chicken drive-thrus, at the Travelodge Northampton Way site, which the Group announced last year. Over the past year, a key strategic priority for the Property and Development function of the Travelodge business has been expanding the Estates team and its remit, due to the Company’s growing hotel portfolio and opportunities to improve its assets. The team is dedicated to supporting the hotels and the wider business with general estate matters and is also responsible for asset management, rent reviews, service charges, business rates, sublets, insurance, asset management, lease renewals and landlord approvals. Members of the Estates team are field-based so that they can make regular hotel visits, allowing full access to the Travelodge hotel portfolio and providing hands-on support for Travelodge’s hotel colleagues and its landlords. Reporting into the Chief Property and Development Officer, Kirsty will be overseeing all operations of the Estates function, made up of six team members, and is currently looking to expand the team further by the appointment of a Regional Estates Manager (South). For more details of this vacancy, please visit: https://www.travelodge.co.uk/careers/ Steve Bennett, Chief Property and Development Officer, Travelodge, comments: “We are delighted to be promoting Kirsty to the position of Head of Estates, as she has proven to be integral to the recent success of the Estates function. Kirsty’s industry expertise and experience represents a significant benefit to Travelodge as a business, and she has already played a crucial role in the growing and improving Estates Management team since joining in 2022.” Travelodge has a significant estate of nearly 600 hotels across the UK, Ireland and Spain, with over 580 of these hotels located throughout the UK. In addition, the group has a large sublet estate, with over 150 subtenants. Furthermore, with over 200 Bar Cafes, Travelodge is also one of the largest Food & Beverage operators in the country. Building, Design & Construction Magazine | The Choice of Industry Professionals
A major event for the South West construction industry brought together 150 industry leaders and professionals to shine a light on major challenges facing the sector. Attendees gathered at the Future Skills Centre in Exeter for the Constructing Excellence South West Construction and Housing Summit and participated in an exclusive one-day event. In true Constructing Excellence South West (CESW) style the agenda was jam-packed. The day kickstarted with a speech from Chair of the Great South West, Karl Tucker, who highlighted the enterprise’s ambitions to lead and influence economic growth, job creation, and prosperity across Devon, Plymouth, Somerset, and Torbay. A series of panellists then took centre stage as attention turned to critical matters impacting the industry including ongoing environmental issues, leadership within construction, the supply chain and procurement processes, the Building Safety Act, housing challenges – namely planning permission, offsite and building regulations – as well as acquiring new skills. As a cross-sector, cross-supply chain member-led organisation, CESW has a keen focus on creating opportunities for like-minded professionals to work more collaboratively so a different approach was adopted for this year’s annual conference. Attendees were given the chance to discuss every topic with their peers and ask each panel a series of questions, completely transforming the summit into an engaging and collaborative open forum. Kevin Harris, CEO of Constructing Excellence South West, said: “It’s not often that so many people from across the South West Construction industry are together in one room, so we knew we needed to make the most of this opportunity. We switched up the format of the summit to make sure everyone could get involved in the discussions taking place throughout the day. “We’ve recorded everything that was mentioned during the summit and will be using these findings to create exclusive best practice content that will be shared more widely with our members. “The feedback we’ve received from those who attended has been incredible and I look forward to seeing what the next few months have in store as we continue to look at how we can bring the region together to continue sharing their knowledge, experience, and examples of best practice.” Charged with connecting industry professionals to shape the future of housing and construction practices, CESW is a member-led organisation that exists to produce a better-built environment. To find out more information about how you can get more involved, visit: https://constructingexcellencesw.org.uk/ Building, Design & Construction Magazine | The Choice of Industry Professionals
Construction company placed in administration after workers given ‘no notice’ Unite the union recently confirmed on Friday 12th of December that it is to hold meetings in Aberdeen and Dundee today following the announcement that the Stewart Milne Group has been placed into administration. Unite stated this week that it is actively exploring legal action against the Stewart Milne Group due to its failure to consult the workforce or Unite in a redundancy situation as ‘no notice’ was given. The two meetings to be held on TODAY will take place at: · 10.30am to 12.30pm – Dundee – Apex Hotel, 1 West Victoria Dock Road, Dundee, DD1 3JP. · 2.30pm to 5pm – Aberdeen – the Beach Ballroom, Beach Promenade, AB24 5NR. Members of the press are invited to attend sections of these meetings but some will be reserved exclusively for workers to discuss protective award claims and further legal support. Interviews with workers can be facilitated by Unite officers at the venues upon request. Unite represents over 60 tradespersons at the construction company in various locations including in Aberdeen, Dundee, Edinburgh and Glasgow. Unite general secretary, Sharon Graham, said: “Unite will do everything possible to support the Stewart Milne Group workers. The company has treated its loyal workforce disgracefully.” The administrator’s Teneo stated that 217 trade roles will be lost but it is feared that hundreds more in the supply chain will lose their jobs. Unite has demanded the Scottish Government and local authorities urgently work with the union to explore how the workers can be found suitable alternative employment on public procurement contracts. It has since emerged that the Partnership Action for Continuing Employment (PACE) will be hosting two webinars – one was last Friday at 2pm, and an upcoming one on the 16 January at 10am for employees affected by redundancy. Unite has criticised the Scottish Government and PACE for this approach stating the hosting of webinars ‘fails to understand the nature of the construction industry’. Unite is highlighting evidence which indicates construction workers face greater reading and writing difficulties, and IT proficiency challenges compared to other workers. The union is therefore demanding public meetings, organised by PACE and the Scottish Government, in the various locations to fully support the workers. John Clark, Unite industrial officer, added: “Unite will be stepping up our efforts to provide legal support for the Stewart Milne Group workers by hosting these meetings in Aberdeen and Dundee. We are crystal clear that the company has acted in a potentially unlawful way, and these events will help our members make protective award claims.” “It’s also extremely disappointing to discover that PACE will be hosting two webinars instead of physical events. We hope this is immediately reviewed because it fails to understand the nature of the construction industry and the proficiency challenges which many workers face.” Building, Design & Construction Magazine | The Choice of Industry Professionals
Provider of powerful AI-based water management systems elevates expectations entering 2024 As organizations around the world face rising costs related to water damage and increased focus on water sustainability, WINT Water Intelligence is building on its success in 2023 to continue solving these challenges for insurance, construction, facilities, and property management companies. In 2023, WINT helped over 400 leading global enterprises mitigate water damage and reduce their environmental footprint; these customers saved a total of 652 million gallons of water which would have resulted in the release of 22,000 metric tons of carbon emissions. In addition, WINT’s solutions prevented over 900 water damage incidents with a total damage potential of tens of millions of dollars. WINT’s success in preventing water damage has helped accelerate the growth of its insurance network, which includes carriers, brokers, MGAs and risk-engineering firms and has nearly tripled during the year. “The economic impact of water damage in buildings and construction sites, combined with increased water stress and scarcity, has ripple effects that impact a wide variety of industries,” said Yaron Dycian, chief product and strategy officer for WINT. “Rising insurance costs for construction and commercial and residential buildings are adding to the impact of the climate crisis and global water shortages. We’re proud that we’ve managed to help our customers avoid the pain of water damage in their facilities, and of having helped reduce the environmental impact of building on water supplies.” Throughout the year, WINT implemented a variety of innovative solutions to help contractors, insurers and property and facilities managers meet the challenges associated with water waste and damage. Over the last 12 months, the company has: “Our achievements in 2023 reflect the serious need for lasting solutions to the problems and costs associated with leaks, water waste and water damage,” said Alon Geva, CEO of WINT. “As we continue to build on our innovation and passion for helping organizations thrive in demanding circumstances, we’re using these accomplishments as the foundation for the results we deliver to customers and our shared future success.” WINT equips contractors, developers, owners and facility management teams with a cutting-edge solution for managing water throughout the lifecycle of a building, from construction to operation. The WINT platform includes automated leak mitigation with real-time detection and auto shutoff; unparalleled anomaly detection and analytics powered by advanced AI algorithms; and enterprise-grade management for operation in large and mid-sized facilities. WINT is used globally by customers including the Empire State Building, HP, PepsiCo, Suffolk Construction, as well as many other leading enterprises, general contractors (GCs) and facility owners. For more information about WINT, visit https://wint.ai.
One the most significant and sustainable urban expansions of Edinburgh in a generation is a step closer to reality following the submission of a major planning application to the City of Edinburgh Council (CEC). West Town Edinburgh Limited, the development consortium headed by Drum Property Group which owns more than 200-acres of prime development land to the west of Edinburgh, has unveiled ambitious proposals for West Town, a new homes-led ‘twenty-minute’ neighbourhood set to transform Scotland’s capital. The 205-acre West Town site – located between Ingliston Park and Ride and the Gogar Roundabout at the western gateway of Edinburgh – is regarded as one of the most strategically important large development areas in the UK. The £2-billion project is set to become the biggest, single homes-led development in Edinburgh in modern times, significantly addressing the city’s well publicised ‘housing emergency’ whilst providing an outstanding quality of life in a brand-new, sustainable mixed-use community. Development proposals follow guidelines set out by CEC’s City Plan 2030 which identifies the area as having the potential to become a vibrant, high-density city extension with a capacity for 7,000 homes – along with the necessary employment, commercial, leisure and community facilities required for a 20-minute neighbourhood. Proposed facilities include schools, medical provision, civic and community space as well as bars, restaurants, cafes, retail and other commercial spaces. There are plans for 27 acres of accessible green space – including a large 5.5-acre central park, several ‘pocket’ parks and a ‘wildlife’ corridor, criss-crossed by a network of cycle, running and walking tracks. The Edinburgh Tram route runs directly through the site and a new tram stop will be created to ensure the whole development has access to quick and efficient public transport. The proposals for West Town are consistent with the West Edinburgh Placemaking Framework, approved by CEC in December 2023 and align with the ambitions of the Scottish Government’s National Planning Framework 4, which was approved in February 2023. West Town Edinburgh was formed in April 2021 by Drum Property Group to progress development of the site. Drum is currently delivering a variety of transformative mixed-use projects across Scotland, including the award-winning Buchanan Wharf and Candleriggs Square developments in Glasgow. Welcoming the planning application submission, Graeme Bone, Drum’s Group Managing Director said: “We now have the opportunity to make West Town an exemplar, sustainable 20-minute neighbourhood on a par with the best new developments taking place across the UK and Europe. “This planning application is a significant milestone in realising the ambition we share with the council both for the local area and for the city, further strengthening the long-term collaborative process that is set to deliver a major transformation of the west of Edinburgh. The amount of space on the site combined with its superb location allows for a natural extension for the city providing 7000 mixed-tenure homes and new jobs in a new 20-minute neighbourhood. West Town has direct access to some of the best public transport in Scotland – the tram line travels through the site and there are integrated rail, cycle and road connections, creating a strategic gateway to Edinburgh. He added: “Drum has a proven track record of delivering high quality large-scale communities across Scotland and our ambition for the area matches that of the proposed Edinburgh City Plan 2030. We look forward to continuing to work with the Council to advance our shared vision to create a new, sustainable urban quarter for the city.” Subject to the ongoing development of the delivery strategy – as set out by the joint Memorandum of Understanding between West Town Edinburgh Ltd and CEC, the approval of City Plan 2030, and in accordance with all relevant council policies and appropriate planning consents – it is hoped that work will start on site before the end of 2024, with the first phase of homes and community amenity being ready for occupation from early 2026. The West Town planning application has been submitted following a successful 12-month local consultation programme which included two online and one public consultation events, resulting in more than 2000 visits to the West Town website. For more information on West Town, visit www.west-town-edinburgh.com Building, Design & Construction Magazine | The Choice of Industry Professionals
A host of new features, interactive demos, international pavilions from across the globe, and a charity Gumball Rally across the country have all been announced by the organisers of the UK’s largest event for the built environment, UK Construction Week (UKCW), which makes a welcome return to London’s ExCeL from 7-9 May 2024. The multi award-winning show will see the debut of a new Live Demo Theatre; Skills and Training Hub; a construction-specific Recruitment Zone; new C-Suite Summits; a ‘Gumball Rally’ which finishes at UKCW London; a host of international exhibitors housed in pavilions from India, China, Turkey, Italy, Spain, Germany and France. UKCW London is once again co-located with Concrete Expo and The Offsite Show, as well as the UK’s premier event for the self-build sector, Grand Designs Live. New features at UKCW London include: Sam Patel, UKCW event director, commented: “Construction is a fast-paced and evolving industry, and so our show needs to reflect that – hence the new areas which focus on skills, training and recruitment to address the skills gap which we all know has been affecting the sector for a number of years.” Registration for UKCW London is now live (and free) through the new-look website. The London show is complemented by its sister event, UKCW Birmingham, which takes place at the NEC from October 1-3. The NEC was the birthplace of UK Construction Week in 2015 and the trade show has grown to become the UK’s largest built environment event. Details on the Birmingham programme of events and speakers will be announced in due course, but exhibition space is already filling up – to enquire for your business, contact Info@ukconstructionweek.com To find out more about both shows and to register for UKCW London for free, visit https://ukcw-london-2024.reg.buzz/cab-pr Building, Design & Construction Magazine | The Choice of Industry Professionals
Engineers this week began a delicate job that will see almost half a kilometre of bridge deck slid into position over the next year, high above the Misbourne Valley in Buckinghamshire, as HS2’s innovative Wendover Dean Viaduct enters a critical new stage of construction. The 450m-long viaduct will be the first major railway bridge in the UK to be built with a ‘double composite’ approach, which uses significantly less carbon-intensive concrete and steel than a more traditional design – and has allowed HS2 to halve the amount of embedded carbon in the structure. It is one of 50 major viaducts on the HS2 project – which is designed to improve connections between London, Birmingham and the North while freeing up space on the most congested southern end of the existing West Coast Main Line. Instead of using solid pre-stressed concrete beams to form the spans between the viaduct piers, the ‘double composite’ structure uses two steel beams sandwiched between two layers of reinforced concrete to create a lightweight and super strong hollow span. Due to the length of the viaduct, the deck is being assembled in three stages, ranging from 90m to 180m sections, with each one pushed out from the north abutment before the next section is attached behind it. This painstaking process means that the weight of the deck will increase with each push, up from an initial 590 tonnes this week to 3700 tonnes by the end of the year. Tomas Garcia, HS2 Ltd’s Head of Civil Structures said: “Double composite structures maximise the combined strength of steel in tension and concrete in compression. This approach has been tried and tested around the world and it’s great to see it applied on this scale for the first time in the UK at Wendover Dean. “Once complete, HS2 will help enhance the existing rail network by freeing up capacity on the busy West Coast Main Line and almost halving journey times between London and Birmingham. This viaduct will play a crucial role enabling those faster and more reliable services – and I hope it will also inspire other projects around the UK to consider this innovative approach to construction.” The viaduct is being built by HS2 Ltd’s main works contractor, EKFB – a team made up of Eiffage, Kier, Ferrovial Construction and BAM Nuttall – with the manufacture and installation of the beams being led by specialists at Eiffage Metal. A winch is used to push the deck forward at a speed of around 9 metres per hour, sliding across Teflon pads to reduce friction – a material usually found to the surface of a non-stick frying pan. It is the longest deck slide on the HS2 project to date. At this point in the Chilterns the railway will be on a slight gradient, so to help maintain control, the deck – which will eventually weigh the same as 264 double-decker buses – is being pushed slightly uphill, with the finish point approximately 1.8m higher than start point. James Collings, EKFB’s senior engineer, said: “The project team has reached a fundamental milestone in the build of this industry-leading viaduct. We’re progressing well with the first-of-three steel launches being conducted this year and already looking forward to seeing this viaduct come to life. Along with our supply chain partners, Eiffage Metal, we’re proud to be delivering this viaduct safely and to programme.” EKFB worked with their design partner, ASC (a joint venture between Arcadis, Setec and COWI) and architects Moxon on the ‘double composite’ approach which was inspired by structures on the French high speed TGV network. The approach is set to cut the carbon footprint of the structure by 56% – saving almost 13,000 tonnes of embodied carbon – and helping HS2 achieve its goal of halving the amount of embedded carbon in construction. The beams are made of ‘weathering steel’ which naturally fades to a dark brown colour over time and will help match the natural tone of the surrounding countryside. A similar approach – using weathering steel and a double composite structure – is also being taken at the nearby Small Dean Viaduct which is currently at a much earlier stage of construction. Weathering steel gets its characteristic colour from a surface layer of corrosion which protects the steel and removes the need for regular painting. The Wendover Dean Viaduct will be supported by nine evenly spaced piers, some of which will be up to 14 metres high. These consist of a series of hollow pre-cast concrete shells – manufactured in Northern Ireland – which are placed on top of each other and filled with concrete and steel reinforcing. This approach was chosen to enable a crisp, clean external finish to the concrete, cut the amount of work on site and reduce disruption for local residents. The last few months has also seen significant progress at HS2’s other major viaducts, with the first concrete poured for the approach viaducts for Birmingham Curzon Street station, the first beams installed at Thame Valley near Aylesbury and the Delta Junction in North Warwickshire. In total, HS2 is building more than 500 bridging structures – ranging from small road bridges to massive viaducts like record-breaking Colne Valley Viaduct which will become the longest in the UK. Building, Design & Construction Magazine | The Choice of Industry Professionals
To advance the UK’s journey toward achieving net zero, Energy & Utility Skills is proud to announce the establishment of the Power Generation Group within the National Skills Academy for Power (NSAP). This initiative strategically aligns with the needs of the renewable sector within the power generation industry. Power generation is undergoing significant technological advancements such as carbon capture, utilisation, and storage (CCUS), energy from waste, wind, and other renewable sources. These advancements are creating numerous job opportunities, with further anticipated industry growth indicating a requirement for an additional 70,000 skilled professionals within the offshore wind sector alone by 2030. In October 2023, the world’s largest offshore wind farm, Dogger Bank, produced power for the first time, and upon full operation, it will provide power equivalent to the needs of six million homes. In addition to this, more than 15 million tonnes of residual waste is converted annually by the UK’s Energy Recovery Facilities (ERFs), enough to supply half the homes in London for an entire year. Currently, however, many employers express concerns about finding and securing the right talent. The Power Generation Group is taking steps to address these concerns by identifying skill gaps and shortages. They have already recognised the need for a targeted approach in crucial areas within energy from waste, such as carbon capture, utilisation, and storage. Specialised skills such as electrical and mechanical engineering, planning and connecting, and supervisory control and data acquisition (SCADA), among others, are foreseen as essential to meet the evolving demands of the renewables industry. Stephen Barrett, Director of Membership and Strategic Engagement at Energy & Utility Skills said: “A focus on renewables within the Power Generation Group allows us to support industry by establishing and upholding the necessary training standards, contributing to the UK’s training infrastructure, and addressing the growing demand for upskilling.” In a world where the transition to net zero is of critical importance, the focus on green skills by the Power Generation Group within the National Skills Academy for Power is a significant step forward. This move underscores Energy & Utility Skills commitment to facilitating the UK’s transition towards a more sustainable and greener energy future. Building, Design & Construction Magazine | The Choice of Industry Professionals
Lending for commercial construction is expected to fall for the ninth year in a row, underlying how demand for office space and high street retail has declined over the period. The analysis comes from specialist property lending experts, Octane Capital, which compared lending levels across different areas of the property construction industry over the past decade using data from the Bank of England. Octane then estimated where total lending would sit come the end of 2023 based on the current data available (Jan to November). The analysis shows that the average monthly amount outstanding across the commercial construction lending sector has gradually fallen from £5.11 billion in 2014 to £3.383 billion in 2022, a drop of 34%. Octane Capital estimates that 2023 will see this figure fall by a further -2.6% in 2023 to £3.30 billion, following on from an annual decline of -4.3% in 2022 and a minor reduction of -0.8% in 2021. Rental recession and challenging year for retail Last year office rentals in London were said to be in “rental recession” due to the number of empty workspaces, as the pandemic has facilitated a growing work from home and flexible working culture. Meanwhile the high street has struggled to compete with the growth of online retail for some time, while consumers are currently being squeezed by the cost of living crisis. In January the The British Retail Consortium warned that retailers are set for a “challenging” year in 2024 due to “weak consumer confidence. Overall construction lending dips for second consecutive year The analysis by Octane Capital also shows that lending across the construction sector as a whole is forecast to fall for a second consecutive year in 2023, as interest rate rises made borrowing gradually less affordable. Octane Capital estimates that the average monthly total of outstanding lending will reach £33.26 billion in 2023, marking a -7.1% drop from the year before, while in 2022 there was also a drop, at -4.0%. The second consecutive annual decline follows the Bank of England base rate hike from 0.25% to 5.25% between December 2021 and August 2023, making the cost of borrowing far more expensive for construction and development firms. Development down but domestic construction sees uplift Commercial lending for the development of buildings – which encompasses structural alterations, demolitions and rebuilding – has been on the steady decline since 2021. Octane Capital estimates that some £12.74 billion of outstanding lending will be recorded in 2023, which will again result in a drop of -7.9%, following previous yearly falls of -5.3% in 2022 and -4.3% in 2021. Lending for domestic construction – a dwelling where more than one family unit lives – is the only construction type expected to go against the grain. After dropping off by -19.8% in 2021 it recovered by 9.2% in 2022, and is estimated to climb by 1.7% in 2023, as is forecast to sit at £6.04 billion for the year. CEO of Octane Capital, Jonathan Samuels, commented: “Demand for commercial construction lending has seen a consistent decline in recent years, with the average monthly amount outstanding falling by 34% between 2014 and 2022 and expected to fall further in 2023. “While the pandemic accelerated the trend for more businesses to embrace hybrid working, it must have come as a shock to the office sector, as it’s ultimately businesses paying competitive rents that justify these construction projects. “Another factor hitting construction is the cost of financing, as it’s becoming harder for developers to make a good return on their investment given that interest rates are relatively high. “One positive is that interest rates now look to be falling again, so it could become more affordable for developers to fund projects in 2024 and beyond, which should help cultivate some growth, albeit this will likely remain subdued versus historic highs.” Data tables and sources Data tables and sources can be viewed online, here. Building, Design & Construction Magazine | The Choice of Industry Professionals
