UK construction contracts in 2017 totalled 71 billion READ MORE

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1 Brought to you by QUICK LINKS Major announcements Construction headlines Detailed sector analysis IN THIS JANUARY ISSUE UK construction contracts in 2 totalled 71 billion READ MORE The TransPennine Route Upgrade, West of Leeds was the top project in 2, valued at 2. billion READ MORE led contract awards in 2, with 2% of the total and a value of around billion READ MORE FULL VERSION AVAILABLE TO BARBOUR ABI CUSTOMERS, BUILDING AND BD SUBSCRIBERS ONLY

2 ABOUT US Specialist provider of construction intelligence Michael Dall Michael is Barbour ABI s Lead Economist specialising in construction and the built environment. He leads on Barbour ABI s research and outputs on the construction sector assessing the trends and developments which impact upon it. Michael is also a regular contributor to Building magazine, sits on the current CPA Forecasting Panel as well as being frequently noted in construction trade and the national press. To contact Michael either: T: E: Bespoke Research & Intelligence Our Economist Michael Dall offers bespoke research and tailored analysis as well as providing consultations and speaking at industry events. Economist Michael Dall, works with customers to offer bespoke research and tailored analysis specific for your individual business. He currently provides consultations, detailed research as well as attend speaking events, speaking on topics related to your individual business needs. DOWNLOAD METHODOLOGY Partner of the and Projects Authority in providing the National and Construction Pipeline Market Insight Designed as the next level of analysis to our monthly Economic & Construction Market Review, this fully interactive quarterly tool allows you to compare sector and regional construction data easily and effectively. This tool gives you deeper analysis and intelligence on the construction market, allowing you and your company to forecast trends and aid in your business planning. To learn more about Market Insight and to download your copy, click on the button below. Additionally, to register your interest in our bespoke construction intelligence and tailored analysis please register your interest by selecting the tick box in the enquiry form. DOWNLOAD MARKET INSIGHT Chosen provider of Construction New Orders estimates to the ONS and communal dwellings data Barbour ABI is a leading provider of construction intelligence services. With a team of in-house research specialists and a dedicated lead economist, it provides commercially relevant insight and unique analysis of trends and developments within the building and construction industry. Barbour ABI is the chosen provider of industry data and indicators for Government bodies including the Office for National Statistics and the UK Government s Construction and Pipeline, which outlines future construction and infrastructure projects where public funding is agreed. Barbour ABI also provides data for independent organisations, such as the Construction Products Association. Barbour ABI is part of global events-led marketing services and communications company, UBM. Cheshire Oaks, Cheshire, CH65 9HQ

3 ECONOMIC CONTEXT UK economic performance disappoints in 2 1.6% Forecast for GDP growth in 2 The UK economy has had a subdued performance in 2 with the headline growth rate falling and inflation rising, though the labour market continues to provide positive news. UK GDP growth in Q3 2 was unchanged from its initial estimate at.4%, with the Bank of England financial crash, demonstrating the recovery over the longer term. sector (which is predominantly manufacturing) accounted for % of output, with the rate of growth.7% between Q3 and 2 Q2, a relatively strong period for construction. Average growth between Q1 forecasting the economy will have grown by 1.6% in 2 overall, down from 1.9% in 2. This is below the average rate of 1.9% since 2 (see fig. 1.1). Since the start of 2 the average growth rate has The sector breakdown of UK economic growth shows that services continue to drive growth, accounting for 79.3% of output in the latest statistics. However, its rate of growth is slowing at.4% in Quarter 3 2 accelerating recently as exports have been boosted by the weaker currency. Production grew by 1% in Quarter 3 with no growth between Quarter 3 and Quarter 2 2 or between Q1 and Q4. and Q4 was lower at.4%. Unemployment The labour market is still proving to be particularly been 2.2% so it is clear that the latest statistics demonstrate a slowing rate of economic growth compared to.5% between Quarter 3 and Quarter 2 2 (see fig. 1.2). Prior to the economic Finally, construction accounted for 6.1% of output according to the latest figures. However, it was the robust with the level of unemployment remaining at 4.3% in the three months to October (see in the UK during 2. The economy is however currently 9.7% larger than the peak before the downturn the average growth rate was even higher at.8% between Q1 and Q4. The production one sector which shrank in Quarter 3, declining by.7%. This compares to an average growth rate of fig. 1.3). This is the lowest rate of unemployment since the period March to May 75. For males the GDP Growth quarter on quarter (%) ECONOMIC CONTEXT 1.1 UK GDP Source: ONS GDP Growth quarter on previous year s quarter (%) Growth (%) GDP Q1 to Q4 Q3 to 2 Q2 2 Q3 Production Manufacturing ECONOMIC CONTEXT 1.2 GDP sector breakdown Source: ONS Construction Services Quarterly change in employment levels (thousands) ECONOMIC CONTEXT 1.3 Unemployment rate Source: ONS Feb 8 Aug 8 Feb 9 Aug 9 Feb Aug Feb Aug Feb Aug Feb Aug Feb 3 month period (starting month shown) Aug Feb Aug Feb Aug Feb Aug Unemployment rate (%)

4 ECONOMIC CONTEXT UK economic performance disappoints in 2 unemployment rate was 4.4% and for females it was 4.1%, the lowest since comparable records began in wage decline the rate had been broadly increasing since late 2 until this year. In fact the latest figures Outlook In conclusion the UK s economic performance has it is no surprise that the prospects for GDP growth are receding. However the labour market remains 71. In numbers there are 1.43 million unemployed show that in the three months to October 2 real been poorer over the last months with the slowing remarkably robust in the face of these pressures. The people in the three months to October, which is average weekly earnings fell by.4% compared to rates of economic growth leading to a downgrade in prospects for the economy will not be helped by the, fewer than the three months to July. There are the same period in 2 (see fig. 1.5). forecasts by the UK s fiscal watchdog the Office for uncertainty surrounding the UK exit from the European 783, unemployed men and 647, unemployed As well as the declining levels of real wages one Budget Responsibility (OBR). The OBR now predict the Union. As the Brexit negotiations continue more women,, fewer than the previous figure. The enduring area of concern for the UK economy GDP growth will be 1.5% in 2 down from a figure of certainty will help businesses with their investment number of people who are in employment fell slightly remains the low levels of productivity within the 2% in its March forecasts. This is then forecast to slow decision process and have a positive impact on GDP. meaning that the rate of economic activity in the workforce. The issue has become so important further to 1.3% in 9 and, all well below the However, given the lack of progress thus far it is no population also decreased. The employment rate that the government has recently written a national figures forecast in its March outlook (see fig. 1.7). surprise that the OBR have taken a pessimistic view was 75.1%, down slightly from the 75.3% in May to industrial strategy to address the problem. The scale With real wages falling and productivity declining and downgraded the economic growth forecasts. July 2. This translates to 32.8 million people of the problem is clear as a comparison of output employed, a fall of 56,. The employment rate for men was 79.4%, compared to 79.8% in the three months to July and 7.8% for women unchanged per hour worked between the UK and the rest of the G7 countries ranks it as having the second lowest growth rate between 97 and 2 (see fig. 1.6). This Nominal wages CPIH Real wages from the three months to July. It is worth noting that comparing both unemployment and employment rates and numbers to the same period in 2 shows appears to have remained the case throughout 2, although no official data has been released. % an improving picture. The unemployment rate is down by.5 percentage points compared to August to October 2 and the employment rate increased by.7 percentage points over the same period. GDP Growth % 1.4% 1.3% 1.3% 1.5% 1.6% Oct 6 Apr 7 Oct 7 Apr 8 Oct 8 Apr 9 Oct 9 Apr Oct Apr Oct Apr Oct Apr Oct Apr Oct Apr Oct Apr Oct Apr Oct Inflation Inflation continues to exceed the 2% target set by the Bank of England, as the weaker currency drives up the cost of imported goods and services. The inflation rate was 3.1% in November as measured by the Consumer Price Index (CPI), up from 3.% in October and the Consumer Price Index including Housing (CPIH) was unchanged at 2.8% (see fig. 1.4). This is the highest level of inflation in five years although recent strong increases have abated. The main driver of inflation in November was an increase in air fares. The other main driver of inflation in November was from the recreation and culture sector with various goods including prices for computer games rising. The main impact of the higher inflation is that real wage growth is declining thus negatively impacting consumer spending. After a sustained period of real ECONOMIC CONTEXT 1.7 UK GDP Source: ONS/OBR (%) N F M A N F M A N F M A N F M A N F M A N F M A N F M A N ECONOMIC CONTEXT 1.4 Inflation Source: ONS CPIH CPI ECONOMIC CONTEXT 1.5 Real wage growth Source: ONS GDP Growth (=) Canada France Germany Italy Japan United Kingdom United States ECONOMIC CONTEXT 1.6 GDP comparison Source: ONS

5 THE CONSTRUCTION SECTOR Construction contracts awards held steady in 2.4% Increase in activity from November 2 Marginal improvement in the value of new construction contracts awarded in 2 indicates stability following 5% decrease in 2. The latest figures from the ONS show that the construction sector in the UK grew by.4% between October and November 2. Comparing output levels with November 2 also showed an increase of.4%. It is clear that the housing sector remains the main component of growth within the industry over the longer term. In particular Private Housing output increased by 8.5% in November from the corresponding month in 2. Output in the Private Commercial sector decreased by 2.2% year-on-year and activity in the industrial sector was 8.4% lower. also declined over the year with activity 8.9% lower in November 2 compared to 2. Traditionally the commercial, infrastructure and housing sectors account for the majority of construction output so the falls in the former are notable. In 2 the challenge will be whether continued growth in housing can offset the declines in the other large sectors. % change Nov 2 Nov 2 Oct 2 Nov 2 Total All Work.4.4 All New Work..4 Public Housing Private Housing Public (ex ) Private Private Commercial Repairs & Maintenance Public Housing Private Housing Non-Housing.2.3 Contracts Awarded Index (Jan 2 = ) All New Build In its latest forecasts the Construction Products Association expect growth of.7% in 2 followed by zero growth in 2. The industry is expected to recover by 9 with growth of 2% currently predicted. The reason for the return to growth in 9 is because it is expected that the deal with the European Union will be agreed, or at least the details will be clearer. This will create more certainty in sectors such as commercial which have been performing less well in recent months. Private Housing Commercial Offices Commercial Retail Factories F M A M J J A S O N D J F M A M J J A S O N D 2 2 In addition to this the construction of the first phase of HS2 is due to begin providing a boost to the levels of output. There are clearly risks, both on the upside and the downside, to these forecasts. The potential of a no deal Brexit or any delays to HS2 would clearly hamper these forecasts. And for that reason the lower scenario forecast predict declines in growth. The CPA/Barbour ABI Index which measures the level of contracts awarded using January 2 as its base month recorded a reading of 4 for December. This is a slight decrease from November but still indicates a growing industry. The readings for Private Housing increased this month, but there were declines in industrial factories and commercial offices. Construction Sector The value of all construction contracts awarded in the UK in 2, according to Barbour ABI data on all contract activity, was 71. billion showing a Construction Growth.7%.% 2.% CONSTRUCTION SECTOR 2.1 Construction activity by sector Source: ONS CONSTRUCTION SECTOR 2.2 CPA/Barbour ABI Index CONSTRUCTION SECTOR 2.3 Growth forecasts Source: ONS/CPA

6 CONSTRUCTION SECTOR Construction contract s awards held steady in 2 marginal (.6%) increase on 2. This figure for 2 shows that contract awards values have steadied somewhat in 2, following 5% decrease in project awards in 2. This provides significant contrast to the pattern of good growth for contract values between 2 and 2. The trend for volume reduction also continued in 2 with the number of projects for the year falling by 1.7%, from,478 in 2 to,1. Whilst this represents a slowing of the rate of decline, compared with 3.2% reduction in 2 and 4.7% decline in 2, it contrasts with the good annual growth rates of.7% in 2,.% in 2 and.4% in 2. East Midlands 7% Projects by Region in the was the 45MW Integrated Waste Management Facility at Rivenhall Airfield, with an estimated value of 679 million and due for completion in 2. Additional power generation contracts include the 46 million mechanical and electrical works package for Hinckley Point C nuclear power station in the region. Whilst in the, the 41.5 MW Blyth Offshore Windfarm will provide 5 wind turbines as part of a demonstration project and has an estimated value of 3 million. was the leading region for contract awards in 2 with 2% of the UK total and value of around billion. Major project awards in included the 1.3 billion Chiltern Tunnels contract which is part of HS2. The was the region with the second highest proportion of construction contracts by value in 2 with % of contract awards. The largest contract award for the region in 2 was the 4 million contract for the Port of Dover Terminal 2 project. The also had % of contract awards in 2, with the Trafford Park Metrolink scheme estimated at 35 million one of the leading contract awards. The West Midlands also featured in 2 with % of contracts awarded throughout the year and boosted by the award of 3.7 billion of HS2 works in September. Other major projects awarded in 2 included the TransPennine Rail Route Upgrade near Leeds valued at an estimated 2.2bn. One of the major contracts 8 West Midlands 3% % % 4 7% 3% 2 2% CONSTRUC TION SEC TOR % 7% 65 Number of Contracts 9% 9% CONSTRUC TION SEC TOR 2. 5 Locations of contracts awarded Construction activity trends 8 2 CONSTRUC TION SEC TOR 2.6 Type of projects Rank Project Region Sector 2 Market Towers, 1 Nine Elms, Twin Tower 9 Hotel, Leisure & Sport 3 Euston Tunnels & Approaches HS2 9 4 Long Itchington Wood Tunnel HS2 9 West Midlands 5 North Quay, Poplar offices, 43 flats, shops & restaurants MW Integrated Waste Management Facility Rivenhall 679 East of England Grosvenor Place Belgravia 5 Hotel, Leisure & Sport 8 Riverside Energy Park, Belvedere 5 9 Spalding Energy Expansion 45 East Midlands Port of Dover Terminal Yorkshire & Humber CONSTRUC TION SEC TOR 2.7 Top ten biggest projects by value Value ( m) TransPennine Route Upgrade West of Leeds had the highest proportion of contract awards value in 2 with 35% of the total, an increase of 2% on 2. Major residential projects awarded in 2 include the Wembley Park development to provide 458 units with a completion date of and value estimated at 5 million. In the North West, the 5 million redevelopment of the former BBC Broadcasting House site in Manchester will see the provision of 4 flats and apartments. Whilst in the West Midlands the 77.2 million Bristol Street/ Hope Street contract in Birmingham deliver a total of 778 flats and apartments. The second largest sector was infrastructure with % share of total contract awards value in 2 which was an increase of 2% on 2. Rail projects were a key feature for infrastructure in 2 with the TransPennine Route and HS2 accounting for 7 leading infrastructure contracts in 2, with an estimated combined total of 9.4 billion. Energy and power projects have also underpinned the infrastructure sector with a number of energy from waste schemes, offshore wind farms and gas turbine projects featuring prominently. Other larger contracts included the 3 million Thirlmere to West Cumbria water mains project and the million M5 Oldbury Viaduct in the West Midlands. 35 % Types of Project

7 %.8.6% RESIDENTIAL 4.3% ahead of tops the regions in 2.6 East Midlands West Midlands RESIDENTIAL 3.1 Contract awards increased to.6 billion in 2 with strong pipeline indicating growth potential. 4.3 Value of contracts by region The residential sector in 2 saw contract awards value at.6 billion, an increase of 4.3% on 2 (see fig. 3.2). continues to be the largest sector and awards values have shown continued annual increases since 2. The sector has benefited from mortgage assistance schemes such as Help to Buy and sustained strong demand for mortgages against a background of historically low interest rates. 2 continues to grow steadily with the value of contracts almost reaching billion in 2 and another year of consecutive growth. Increase on % RESIDENTIAL Project value 2

8 RESIDENTIAL 4.3% ahead of 2 At the close of 2, annual house price growth slowed compared with 2. Whilst demand for housing was underpinned by low mortgage rates with constraints on supply helping to support price increases, consumer confidence was affected by increasing pressures on household incomes. Regional variations in average house prices began to moderate in 2 as the South East and more particularly, experienced marked slowdown in average price growth. The latest house price index from the Nationwide showed average house prices are increasing at 2.6% for 2, down from 4.5% annual growth in 2. The Halifax also reported a slowing of house price growth with 2.7% increase for December 2 compared to 6.5% for December 2. Whilst mortgage approvals continued to increase during 2, the proportion attributable to re-mortgages gained share. Projects by region There was also an increase for planning activity in the residential sector in 2, with the total value of projects reaching an advanced planning stage at 55.5 billion. This is an increase of.5% from value in 2, providing a strong basis for work to be commissioned in 2 (see fig. 3.3). Whilst not all these projects will advance to contract award stage, the value increase in 2 indicates that there is still RESIDENTIAL 3. 3 continued to be the largest region for residential contract awards in 2 reflecting the higher population density which continues to underpin demand for housing. contracts worth a total of 4.8 billion were awarded in accounting for 2% of all residential contract awards over the year. The moved in second place in terms of regional contracts awards with % share of residential contracts awards in 2, an increase of 3% on 2. The was another major region with % of contract awards, with value of 3.2 billion (see fig. 3.1 & 3.4). Major residential contracts by value in 2 included North Quay, Poplar where 1,3 flats are to be built as part of regeneration scheme with total estimated value of 8 million. Other notable residential contracts included the 5 million Wembley Park scheme to deliver 458 apartments and the 9- Marsh Wall scheme valued at million for 4 apartments over 53 storeys. Regeneration schemes have provided a number of residential contract awards in the North Detail planning West region in 2 with Manchester a particular focus. The redevelopment of the former BBC Broadcasting House on Oxford Street is set to provide 4 units with a project value of 5 million, whilst the million redevelopment of Portugal Street East also in Manchester will provide 34 flats. In the the 75 million redevelopment of the Former Gas Works site in High Wycombe will provide 9 flats as well as 1,472 sq m of commercial space. House prices Contracts at advanced planning RESIDENTIAL 3.4 Change of activity by region (since 2) strong potential for the UK residential sector into the short to medium term. Outlook The residential sector is subject to a number of influences including a level of institutional investment as well as changes to interest rates which affect mortgage repayment levels. Whilst still regarded as cautious, investment levels for residential projects have continued to increase in 2, boosted by the continued positive financial performance of major national housebuilders. There is a strong project pipeline which should continue to underpin the residential sector into 2, whilst Government policy is currently focused on continuing the Help to Buy scheme with the ultimate aim of increasing the number of net additions to the housing stock in the medium-term. growth will continue to be focused on and the due to sustained demand for new residential units and the current number of schemes in the pipeline. Regeneration schemes have provided impetus for the residential sector in 2 and this should continue to provide a good basis for residential development in urban areas, particularly the, West and East Midlands. -1.3% East Midlands +.2% -.6% -.6% -3.9% -.1% +.5% +.4% West Midlands +3.1% +.7% +1.5% +3.1% Top Ten Increase for HOTTEST REGION compared to 2 CLIENTS, ARCHITEC TS, CONTR AC TORS & PROJEC TS

9 RESIDENTIAL 4.3% ahead of 2 1 Barratt Homes 4 2,94 2 Persimmon Homes Limited 3 2,55 3 Taylor Wimpey 8 1,5 Key Clients Projects Contract awarded December 2 4 Bellway Plc 95 1,86 5 Canary Wharf Group PLC Bloor Homes Redrow Homes Limited The Berkeley Group Keepmoat Regeneration Limited Cala Group 46 5 Rank PID Project Name North Quay, Poplar offices, 43 flats, shops & restaurants NORTH WEST Sir Henry Royce Institute Circle Square Value ( M) 8 5 Details Date: Q3 2 TBC Contractor Canary Wharf Group PLC Date: Oct 2 Oct 9 Funding: Mixed Contractor Laing O'Rourke Northern Limited 1 Foster & Partners 2 1, 2 Persimmon Homes Limited 99 1,91 3 PRP Architects PLP Architecture MSMR Architects Key Architects Wembley Park Plot E5 Princes Gate Mansions 2 mansion houses 2 Marsh Wall Redevelopment The Madison 5 Date: Jan 2 Jan 1 Contractor John Sisk & Son Limited Head Office Date: Jan 2 Jan 2 Contractor Knightsbridge Construction Limited Date: Jul 2 Jul 1 Funding: Mixed Contractor Balfour Beatty Group Limited Head O ff i c e 6 Barratt Homes Feilden Clegg Bradley Architects Pegasus Planning Group Benoy Limited 1 46 Taylor Wimpey Barratt Homes 7 2,1 2 Persimmon Homes Limited 5 2,1 3 Taylor Wimpey 1 1,534 4 Sir Robert McAlpine Limited 1,3 Key Contractors NORTH WEST Portugal Street East Phase 1 34 flats & commercial units NORTH WEST Circle Square, Oxford Road Blocks 5 & 6 YORKSHIRE & HUMBER West Campus Hull UPP student accommodation SOUTH EAST Charter Square Staines NORTH WEST Chapel Wharf, Salford 995 flats 5 Date: Jan 2 Jan 1 Contractor AECOM Date: Dec 2 Dec 9 Contractor John Sisk & Son Limited Date: May 2 Dec 9 Contractor Vinci Construction Date: May 2 TBC Contractor Square Date: Jan 2 Jul 9 Contractor Sir Robert McAlpine Limited 5 Bellway Plc 98 1,1 6 Redrow Homes Limited Galliford Try Construction Canary Wharf Group PLC Keepmoat Regeneration Limited The Berkeley Group 3 6 The ranking tables are compiled from Barbour ABI database and are based on the total value of contracts awarded over the previous month period. The values represent the construction cost of each project

10 % INFRASTRUCTURE 8.1 East Midlands West Midlands INFR A STRUC TURE 4.1 Transport contracts, particularly rail, underpinned awards value growth in 2, however the planning pipeline is less positive Third year of consecutive growth boosts sector West Midlands tops the regions in 2 % 2.4 Value of contracts by region Contract award values in the infrastructure sector totalled 2.7 billion in 2, an increase of 7.4% on 2 (see fig. 4.2). This increase is the third consecutive annual upward movement and means that contract awards values have increased by 6.9% since the recent low point of.8 billion in 2. 2 It was an up and down year for that was boosted by major HS2 contracts. Increase on % INFR A STRUC TURE Project value 2

11 INFR ASTRUCTURE Projects by region Detail planning The West Midlands was the main location for infrastructure projects in 2 with 2.4% of the total value of contract awarded, a.3% increase from 2 (see fig. 4.1 & 4.4). Key to the West Midlands being the leading region in 2 was the awarding of a number of HS2 contracts centred on the region in the autumn months with a total value of 3.7 billion. These included the Long Itchington Wood Tunnels and the Delta Junction. had the second largest share of contract awards value in 2 with.9% share, up by 7.4% on 2. Again an HS2 contract was the largest award for the region with the 9 million contract for the Euston tunnel and approaches. Railway works also accounted for the largest single contract award in 2 with the 2. billion TransPennine route upgrade contract awarded to Bam Nuttall. Notable power and utilities contracts included the 45 MW Integrated Waste Facility at Rivenhall Airfield in the and the 46 million Mechanical and Electrical Works package at Hinckley Point C in the South West. Another significant contract award was the 4 million Port of Dover Terminal 2 project in the. Whilst contract award growth was good in 2, the value of projects reaching detail planning stage declined. The value of projects at advanced planning stage was 7.4 billion, a decrease of 7.2% on 2 (see fig. 4.3). This indicates that the pipeline for 2 is smaller than in previous years. However, a key characteristic of the infrastructure sector is that the time period between planning and contract awards is relatively small when compared with other construction sectors meaning that contract awards could remain strong into 2. Outlook The outlook for the infrastructure sector remains positive in terms of construction output growth with HS2 likely to provide significant growth to 2. In addition, the power and distribution sector should 2 Third year of consecutive grow th boost s sec tor Decrease in the value of projects at advanced planning stage compared to 2 Contracts at advanced planning INFR A STRUC TURE 4.4 Change of activity by region (since 2) 7.2% 2 INFR A STRUC TURE 4. 3 Due to the major HS2 contracts worth a total of 3.7 billion in the West Midlands propelled the region to the top spot with 2.4% of the total contract value, alongside being the hottest region in the year with a.3% increase on 2. However, outside of a few major projects the pipeline for 2 does not look strong at this point. also provide impetus through a number of energy from waste facilities contracts awarded in 2 as well as the continued contribution from renewable energy schemes. The Government has continued to support infrastructure expansion with announcement in the Budget for the 1.7 billion Transforming Cities Fund to improve local transport connections as well as 385 million for the development of 5G and full fibre broadband networks. The pipeline for 2 looks weaker but this is likely to be balanced by increases in construction output as stages of the larger-scale contracts are completed. +.6% East Midlands -4.6% -.6% +2.6% +7.4% -5.1% -4.5% +.3% West Midlands -4.1% +7.9% -.% +.3% Increase for West Midlands compared HOTTEST REGION to 2 Top Ten CLIENTS, ARCHITEC TS, CONTR AC TORS & PROJEC TS

12 INFRASTRUCTURE Third year of consecutive growth boosts sector 1 HS2 7,3 2 Network Rail Limited 1 2,871 3 Highways England 94 Key Clients Projects Contract awarded December 2 4 EDF Energy Gent Fairhead & Company Limited Roxhill Developments Limited Dover Harbour Board Cory Environmental Spalding Energy Expansion Limited 1 45 TFGM Transport For Greater Manchester Rank PID Project Name YORKSHIRE & HUMBER Transpennine Route Upgrade West of Leeds Euston Tunnels & Approaches High Speed 2 (HS2) Value ( M) 2 9 Details Date: Oct 2 TBC Funding: Public Contractor BAM Nuttall (UK Head Office) Date: Dec 2 Oct 7 Funding: Mainly Public Contractor SCS JV 1 Race Cottam Associates Limited Austin Smith Lord RPS Group Plc Atkins Hartwell Architects Halliday Clark Limited 1 7 Gebler Tooth Morgan Sindall Plc Mouchel Group 2 58 Key Architects WEST MIDLANDS Long Itchington Wood Tunnel High Speed 2 (HS2) EAST OF ENGLAND 45 MW Integrated Waste Management Facility Rivenhall Riverside Energy Park (96MW) Belvedere EAST MIDLANDS Spalding Energy Expansion 3MW Gas Turbine (OCGT) SOUTH EAST Port of Dover Terminal Date: Dec 2 Dec 3 Funding: Mainly Public Contractor CEK JV Date: Aug 2 Aug 1 Funding: Mixed Contractor Hitachi Zosen Inova UK Limited Date: Jan 1 Jan 4 Contractor Hitachi Zosen Inova AG Date: Sep 2 TBC Contractor Siemens Limited Date: Feb 2 Feb 1 Contractor VolkerStevin Limited Pascall & Watson Architects BBV JV 2 2,8 2 BAM Nuttall 9 2,393 3 CEK JV 2 2,2 4 Align JV 1 1,3 Key Contractors NORTH WEST Metrolink Scheme Trafford Park NORTH WEST Thirlmere to West Cumbria Link Water Mains Project NORTH WEST Lostock Energy from Waste Facility (6MW) Date: Nov 2 Nov 1 Funding: Public Contractor M-Pact Thales/Volker Rail/Laing O'Rourke/Thales Date: TBC TBC Contractor Farrans Construction Limited Date: Oct 2 Oct 1 Contractor Baumgarte Boiler Systems 5 SCS JV Hitachi Zosen Inova UK Limited VolkerFitzpatrick Limited 7 8 Balfour Beatty Group Limited 68 9 NG Bailey & Company Limited Morgan Sindall Plc 388 The ranking tables are compiled from Barbour ABI database and are based on the total value of contracts awarded over the previous month period. The values represent the construction cost of each project

13 % 8.5 CO M M ERC I A L & R E TA I L 2 see continued weakness 4.2 tops the regions in East Midlands 1.3 West Midlands COMMERCIAL & RETAIL 5.1 Consumers increasingly shopping online is impacting retail developments, whilst the offices sector remains subdued in the face of Brexit uncertainty % Value of contracts by region The weakness of the commercial & retail sector continued in 2 with overall contracts awarded valued at 7. billion, a decrease of 2.9% from 2 (see fig. 5.2). This follows a 32.6% decline in 2 and underlines the uncertainty within the sector which has been impacted by the wider economic implications of the Brexit issue and structural changes to consumer shopping habits. The sector experienced its weakest year for more than five years as consumers purchasing online continues to hamper commercial & retail development. 9 6 Decrease on % COMMERCIAL & RETAIL Project value 2

14 COMMERCIAL & RETAIL 2 see continued weakness continued to dominate as the leading region for commercial contract awards in 2, accounting for.7% of the value of contracts awarded but this is a.2% decrease on the previous year (see fig. 5.1 & 5.4). Major contracts in the region in 2 included the 2 million 1 Park Place at Canary Wharf to provide 2, sq m of office floor space in a 31 storey structure. Another major contract was the Bank Street development in Poplar estimated at 7 million which will provide office space and retail units in a 31 storey building. In the one of the major contracts was the million extension to the Lakeside Shopping Centre in Thurrock to provide up to 4 additional retail units. In side one of the major commercial & retail contract awards was the 83 million project at 7 & 8 Wellington Place in Leeds to provide an 8 storey mixed used development of 37, sq m of office, retail and restaurant floorspace. Detail planning non-financial commercial developments are likely to continue to provide opportunities for construction growth into the medium-term, the extent to which these could fill the gap caused by any downturn in the financial office sector remains questionable. The retail sector is heavily dependent upon levels of consumer confidence and spending. The sector is also facing significant structural changes due to consumer shopping habits and the growth of online, click & collect and same day delivery options that are fuelling growth in warehousing and distribution space rather than traditional bricks and mortar outlets. Opportunities for construction growth into 2 and beyond are likely to presented through the current expansion programmes for the discount grocery and variety multiples % COMMERCIAL & RETAIL 5. 3 Contracts at advanced planning Increase in the value of projects at advanced planning stage compared to 2 COMMERCIAL & RETAIL 5.4 Change of activity by region (since 2) Looking at the level of detailed planning across the sector is very encouraging with projects reaching the stage worth a total of billion on the year, almost a 5% increase compared to 2. As major supermarkets scale back on large stores, future growth in 2 and beyond is likely with the expansion of smaller convenient units. The future of the UK s relationship with the EU in the post-brexit era remains a key challenge for the commercial & retail sector. The commercial sector, in particular, will be susceptible to any changes in the UK s position as a key financial centre and could negatively impact office building programmes in the capital but also regional financial clusters such as Birmingham, Manchester, Edinburgh, etc. Whilst In contrast to the value of contract awarded, the value of schemes reaching the Detail Planning stage increased significantly in 2. Total value for schemes in 2 was. billion, an increase of Outlook 48.9% on 2 and indicating a significant step up from levels in 2 to 2 (see fig. 5.3). However, this increase in planning activity in 2 may not translate into increased construction activity in 2 as it may take some schemes to come to fruition. What it does indicate is that the pipeline for the commercial & retail sector is a higher level that at any time in the recent past and underlines the sentiment for continuing investment in the sector. Projects by region +1.3% East Midlands +1.8% +4.8% +3.7% -.2% +.2% -.8% -5.6% West Midlands +2.1% +5.3% -.6% +5.3% Increase for Yorkshire & Humber compared HOTTEST REGION to 2 Top Ten CLIENTS, ARCHITEC TS, CONTR AC TORS & PROJEC TS

15 COMMERCIAL & RETAIL 2 see continued weakness 1 Google UK Limited Canary Wharf Group PLC Intu Group 4 6 Key Clients Projects Contract awarded December 2 4 Development Agency 1 5 Lidl UK GMBH Goldman Sachs International Limited 1 7 British Land Corporation Plc Interxion 1 9 Lasalle Investment Management 4 4 Warrington Borough Council BDP Kohn Pedersen Fox (International) PA Bjarke Ingels Group Heatherwick Studio Adamson Associates (International) Limited Squire and Partners D Reid (Architects) Limited Farrells 1 9 Benoy Limited 6 8 Scott Brownrigg Limited Lendlease Construction (EMEA) Limited Canary Wharf Group PLC McLaren Construction Limited Sir Robert McAlpine Limited 5 5 Multiplex 1 Key Architects Key Contractors Rank PID Project Name Park Place Canary Wharf o ff i c e s Bank Street Heron Quays West offices, restaurant, bank & retail units EAST OF ENGLAND Intu Leisure Lakeside Redevelopment retail Goldman Sachs HQ fit out YORKSHIRE & HUMBER 7 & 8 Wellington Place offices/ retail/restaurants Liverpool Street office extension/refurbishment 6 Wall office/retail EAST MIDLANDS Intu Broadmarsh shopping centre Phase 1 One Crown Place Old Street, The Tower Phase 2 Value ( M) Details Date: Q3 2 TBC Contractor Canary Wharf Group PLC Date: Q1 2 TBC Contractor Canary Wharf Group PLC Date: Sep 2 May 9 Contractor McLaren Construction Limited Head O ff i c e Date: Oct 2 TBC Contractor Speller Metcalfe (Malvern) Date: Sep 2 Sep Contractor Wates Construction Limited Date: Jan 2 Dec 9 Contractor Sir Robert McAlpine Limited Head Office Date: Jul 2 Jul 9 Contractor Skanska Construction Date: Feb 2 Feb Contractor Sir Robert McAlpine Date: Mar 2 Jul Contractor Mace Limited Head Office Date: Q1 2 Q3 2 Contractor Skanska UK Head Office 6 ISG 2 7 BAM Construction Skanska UK Mace Limited 5 5 Kier Construction Limited-Building UK 6 The ranking tables are compiled from Barbour ABI database and are based on the total value of contracts awarded over the previous month period. The values represent the construction cost of each project

16 % H O T E L, L E I S U R E & S P O R T % 6.4 tops the regions in East Midlands West Midlands HOTEL, LEISURE & SPORT 6.1 Hotel developments within continue to boost sector with leisure and sports facilities also performing well Growth of.1% in 2 continues upward trend.4 Value of contracts by region 7 The value of contract award values in the hotel, leisure & sport sector in 2 were 6.1 billion, an increase of.1% from 2 (see fig. 6.2). This follows.5% increase from 2, and continues the upward trend evident in 2. 6 domination helped the sector continue to grow with contract value breaking the 6 billion barrier Increase on 2.1% HOTEL, LEISURE & SPORT Project value 2

17 HOTEL, LEISURE & SPORT Projects by region Detail planning Outlook was the main region for contract awards in 2 with 4% of project values, followed by the and East Midlands with % and % respective share (see fig. 6.1 & 6.4). Hotels were a significant feature of the sector in the region during the year with the 9 million 1 Nine Elms development set to provide a 2-bed luxury five star hotel as part of a development to include retail space, offices and 491 residential units. In addition, the 5 million redevelopment of 1-5 Grosvenor Place will see the construction of a new bedroom hotel and apartments which is due to be completed by the end of. In the East Midlands the Peak Resort project is set to provide a new leisure and tourism resort with holiday lodges, golf course, restaurants, bars, spa facilities, etc. Valued at an estimated 4 million building works are due to start in Q1 2. Significant sports based contracts were also concentrated in and included the million extension to Twickenham Rugby Football Stadium and the 4 million expansion of Fulham Football Club s Riverside stadium. The value of projects in the sector reaching advanced planning in 2 was 6.7 billion an increase of 8.2% from 2 (see fig. 6.3). There has been some volatility in the sector since 2 with peak value for advance planning in 2 at 8.1 billion. However, the 2 value of 6.7 billion is 53.4% higher than for 2 indicating that prospects for the sector remain positive. The prospects for the hotel sector remain positive with the budget hotel sector, in particular, pursuing expansion programmes into the medium-term. Other key sectors for expansion include the luxury five-star sector as well as the apart hotel sector which has gained considerable momentum in recent years. Occupancy rates and revenues continue to be good with Visit England indicating that demand for hotel rooms has increased throughout 2. Sports stadia redevelopments and extensions should provide an impetus for construction growth into the medium-term, particularly for higher profile sports such as football and rugby. The food service sector should also provide opportunities, although sudden changes to consumer spending and availability of disposable incomes could affect the roll out of expansion plans for some major chains. Grow th of.1% in 2 continues upward trend % Increase in the value of projects at advanced planning stage compared to 2 HOTEL, LEISURE & SPORT 6. 3 Contracts at advanced planning HOTEL, LEISURE & SPORT 6.4 Change of activity by region (since 2) With 4% of the construction contract value in, the capital well and truly dominated the sector in 2 as investors and contractors saw potential, particularly for hotels. The biggest project of the year was the 9 million 1 Nine Elms development providing a Luxury five-star hotel in. +6.% East Midlands -.4% +.4% -3.1% +.1% +.1% +.2% -6.3% West Midlands -1.6% -.3% -.% +.1% Top Ten Increase for HOTTEST REGION compared to 2 CLIENTS, ARCHITEC TS, CONTR AC TORS & PROJEC TS

18 HOTEL, LEISURE & SPORT Growth of.1% in 2 continues upward trend 1 Wanda Dalian One GP LLP Birchall Properties 1 4 Key Clients Projects Contract awarded December 2 4 Heads of The Valleys Development Company Limited Whitbread PLC Manchester City Council The Berkeley Group Stanhope Plc The Penny Brook Hotel Limited 1 77 Equity Group Limited 1 7 Rank PID Project Name Market Towers 1 Nine Elms Twin Tower 1-5 Grosvenor Place Belgravia Value ( M) 9 5 Details Date: Feb 2 Aug Contractor Multiplex Head Office Date: Jan 2 Jan 1 Contractor Robert McAlpine Limited 1 Kohn Pedersen Fox (International) PA Archer Humphryes Architects Hopkins Architects Moxley Architects Stanton Williams 1 4 Key Architects Ealing Filmworks 1 flats, shops, cinema & restaurants The Pennybrook Plot N Zone 3B NORTH WEST Norfolk House Baltic Triangle Luxury Vincent Hotel 83 7 Date: Aug 2 Aug 1 Contractor St George PLC Date: Dec 2 Dec 9 Contractor Ardmore Construction Limited Head O ff i c e Date: Aug 2 Feb 9 Contractor Newry Construction 6 Populous 2 7 Tew & Smith Architects Simpson Haugh & Partners Leach Rhodes & Walker LLP 4 1 TP Bennett LLP NORTH WEST Bridge Street Quarter, Time Square leisure & restaurant block Twickenham Rugby Football Union Stadium East Stand extension 6 54 Date: Oct 2 TBC Funding: Mainly Public Contractor Vinci Construction Date: Mar 2 Jun 2 Contractor Mace Limited 1 Multiplex Sir Robert McAlpine Limited FCC Kier Construction Limited-Building UK 1 5 Willmott Dixon Construction Limited 4 6 Laing O'Rourke 2 1 Key Contractors EAST MIDLANDS Project Medius Great Central Street EAST MIDLANDS Rushden Lakes Phase 2 and 3 leisure, cinema and retail SOUTH EAST Worton Grange commercial units/hotel Date: Jan 2 Jul 9 Contractor Morgan Sindall Date: Sep 2 Mar Contractor Winvic Construction Limited Date: Apr 2 Apr 9 Contractor Kier Construction Southern Limited 7 Ardmore Construction Limited The Berkeley Group Newry Construction 2 8 McAleer & Rushe Limited 5 76 The ranking tables are compiled from Barbour ABI database and are based on the total value of contracts awarded over the previous month period. The values represent the construction cost of each project

19 % % INDUSTRIAL Downward trend continues into East Midlands tops the regions in 2 East Midlands West Midlands INDUSTRIAL 7.1 Rate of decline has slowed in 2 and strong pipeline indicates potential for improvement into the medium-term Value of contracts by region 8 The industrial sector saw contract awards value decrease to 5.4 billion in 2. This was a decrease of 5.3% from 2 and followed a.3% decrease in 2 (see fig. 7.2). Whilst the industrial sector has shown significant progress since 2, the results for 2 show that industrial sector contract awards peaked for the current cycle in 2. Although the trend over the last years has been downward, the rate of decline has slowed in 2, with a relatively strong pipeline indicating potential for some improvement into the medium-term. 7 The sector has decreased in contract value by.3% compared to 2, however a strong pipeline provides a brighter outcome for those involved in industrial construction Decrease on % INDUSTRIAL Project value 2

20 INDUSTRIAL Downward trend continues into 2 Projects by region In terms of regional activity, the East Midlands had the largest share at % of contract awards value, up 6.% on 2. The second largest region was the with % of contract values, up 2.5% on 2, followed by the West Midlands with %, an increase of 1.% on the previous year (see fig. 7.1 & 7.4). Key contract awards for the East Midlands included the Prologis Park in Northampton which will see 5,584 sq m of storage and distribution facilities with associated office space developed on a 2.4 hectare site. The contract is estimated at million and has been awarded to Buckingham Group Contracting Limited. In the West Midlands region, a significant contract award was the 9 million Jaguar Land Rover research, development and testing facility at Gaydon. Awarded to Laing O Rourke Head Office, the contract will provide 39, sq m of floor space in a 2 storey structure and is due for completion in April 9. However, the largest industrial contract award in 2 was in the Region and was the estimated million Amazon Distribution Unit in With no projects worth over 2 million in 2, the sector struggled to gain mega projects that often propel a sector into positive growth. With the Government committed to funding research & development activities provides a healthy pipeline moving into 2. Bristol. Awarded to ISG Limited, the project involves the provision of, sq m of warehousing, distribution and associated office space. contract awards value have fallen, the growth trend in detail planning indicates that developer interest in the industrial sector remains significant. Detail planning Outlook Detail planning activity increased by 7.6% in 2 with total value of projects reaching advanced planning stage at 8. billion. This compared with 7.5 billion in 2 and 7.2 billion in 2 (see fig. 7.3). Whilst While the contracts awarded values were lower in 2, the industrial pipeline of works remains relatively healthy. The Government remains committed to ongoing funding of research and The widening of activity away from warehousing, continued into 2 with laboratories, R&D facilities, food & beverage production facilities and light/hi-tec industrial facilities featuring prominently in contract awards development activities and in the 2 Budget committed to a further 2.3 billion of R&D funding for the 1-2 period from the National Productivity Investment Fund. In addition, programmes such as the Northern Powerhouse and redevelopment of major former industrial sites should also provide impetus for further growth into the medium-term. In addition, changes to consumer shopping habits should also benefit the industrial sector. This is likely to see the continued development of bespoke warehousing and distribution facilities in order to service click and collect and same day delivery services increasingly offered by some of the larger retail organisations. The food processing sector will is also likely to promote construction growth with development of new facilities as well as extension and refurbishments to existing processing units. 2 INDUSTRIAL % Contracts at advanced planning Increase in the value of projects at advanced planning stage compared to 2 INDUSTRIAL 7.4 Change of activity by region (since 2) +6.% East Midlands +2.5% -2.5%.% -1.% -.6% +.3% +.8% West Midlands -4.9% -.8% +.2% +6.% Increase for East Midlands compared HOTTEST REGION to 2 Top Ten CLIENTS, ARCHITEC TS, CONTR AC TORS & PROJEC TS

21 INDUSTRIAL Downward trend continues into 2 1 Mountpark Logistics Prologis UK Limited Ministry of Defence 3 Key Clients Projects Contract awarded December 2 4 Goodman Logistics Developments UK Limited Roxhill Developments Limited 4 6 Segro PLC Jaguar Land Rover Limited Euro Garages Limited Hill Street Holdings 1 9 IDI Gazeley Limited 2 85 Rank PID Project Name SOUTH WEST Central Park, Severnside Amazon distribution unit EAST MIDLANDS Prologis Park Pineham Plot 1 Zone C Value ( M).4 Details Date: Sep 2 TBC Contractor ISG Limited Date: Apr 2 Apr 9 Contractor Buckingham Group Contracting Limited 1 Stephen George & Partners 4 2 UMC Architects 1 3 AJA Architects LLP Michael Sparks Associates 9 5 PHP Architects Isherwood McCann Ridge & Partners LLP Jennings Design Limited Norr 9 73 Key Architects EAST OF ENGLAND Raf Marham infrastructure & facilities upgrade EAST MIDLANDS Battleflat Lodge Farm Option 2 WEST MIDLANDS Jaguar Land Rover NVH Technology Centre SOUTH EAST Oxford Technology Park NORTH WEST Frontier Business Park industrial/hotel/restaurants Date: Aug 2 Jul 9 Funding: Public Contractor Galliford Try Lagan Construction JV Date: TBC TBC Contractor Winvic Construction Limited Date: Aug 2 Aug 9 Contractor Laing O'Rourke Head Office Date: Jul 2 Jan 2 Contractor Hill Street Holdings Date: Sep 2 Mar 9 Contractor Barnfield Construction Limited PRC Architects Limited WEST MIDLANDS Lyons Park Plot 1, 2, 3 & 4 storage & distribution 6.3 Date: Nov 2 Oct 2 Contractor Winvic Construction Limited 1 Winvic Construction Limited Buckingham Group Contracting Limited ISG 1 4 A & H Construction & Development 6 Key Contractors SCOTLAND Lidl UK Distribution Centre Eurocentral Business Park SOUTH EAST Eagle Farm North Plot Date: Jul 2 Nov 2 Contractor Winvic Construction Limited Date: Jul 2 TBC Contractor Readie Construction Limited 5 Galliford Try Lagan Construction JV Barnfield Construction Limited Readie Construction Limited Laing O'Rourke Kier Construction Limited-Building UK 86 Robertson Group Limited 7 68 The ranking tables are compiled from Barbour ABI database and are based on the total value of contracts awarded over the previous month period. The values represent the construction cost of each project

22 %.8.1%.1 tops the regions in 2 M E D I C A L & H E A LT H.9 Sector hits new low point of 1.3 billion in 2 East Midlands West Midlands MEDIC AL & HE ALTH 8.1 The, and increased share of contract awards in 2 but overall planning pipeline indicates little overall change in Value of contracts by region Further decline in contract award values for the medical & healthcare sector was evident in 2 with total of 1.3 billion contracts awarded (see fig. 8.2). This is a.5% decline from 2 and follows.5% decline from 2. Contract awards for the sector have been on a downward trend since 2 with total value in 2 approximately 6.9% lower than the 2 peak of 3.4 billion. 2 The sector has decreased dramatically since its high of 2, with little sign of a resurgence when looking at the 2 pipeline. Decrease on 2 5.5% MEDIC AL & HE ALTH Project value 2

23 MEDIC AL & HE ALTH Projects by region Outlook The had the highest proportion of contracts by value in 2 with.1%, an increase of.7% on 2 (see fig. 8.1 & 8.4). Key projects included the 75 million private sector Nuffield Hospital and Wellbeing Centre in Manchester as well as the Rutherford Cancer Centre in Liverpool estimated at 35 million. received a total of.9% of contract awards value in 2 compared to.4% in 2. One of the largest projects was the Orkney Campus Balfour Hospital which is a 59 million project to deliver a new general hospital and set to open in 9. In Aberdeen, the development of the Anchor Centre at the Fosterhill Campus saw the awarding of the 5 million contract for the provision of a new cancer treatment centre. The outlook for the medical & health sector into the medium-term is for a broadly stable level of construction output. The NHS budget has been focussed on major disease prevention and delivery of existing services in recent years rather than the delivery of new hospital buildings which indicates that an uplift in construction output into the medium-term remains unlikely. However, 2 The value of schemes at Detail Planning stage in 2 remained virtually unchanged at 1.3 billion in 2, an increase of.2% on 2 (see fig. 8.3). This follows 2 years of significant decrease and could indicate a measure of stability returning to the sector. The led all regions with.1% of the contract value in 2, however it was that had two of the top three biggest projects on the year, both worth over 5 million..2% 5 Detail planning several pinch points within current service delivery are becoming increasingly apparent particularly waiting times at A& E departments and the crisis in the social care sec tor. These aspects, in particular, could provide impetus for capital injections to extend and improve existing facilities in the medium to longer term. Sector hit s new low point of 1.3 billion in Increase in the value of projects at advanced planning stage compared to 2 MEDIC AL & HE ALTH 8. 3 Contracts at advanced planning MEDIC AL & HE ALTH 8.4 Change of activity by region (since 2) An uplift of construction output in 2 looks unlikely as the NHS has been focussed on disease prevention and their existing services rather than building new hospitals, however with A&E waiting times at a near crisis, pressure will be put on the Government to provide more services. +1.5% East Midlands -.4% -3.3% +4.8% -1.5% +2.6% -3.% +.4% West Midlands +.7% -.3% -1.5% +.7% Top Ten Increase for HOTTEST REGION compared to 2 CLIENTS, ARCHITEC TS, CONTR AC TORS & PROJEC TS

24 MEDICAL & HEALTH Sector hits new low point of 1.3 billion in 2 1 Aneurin Bevan Health Board 1 2 Frimley Health NHS Foundation Trust Manchester Metropolitan University 1 75 Key Clients Projects Contract awarded December 2 4 NHS Lothian NHS Orkney NHS Grampian National Waiting Times Centre Board Proton Partners International The Howard de Walden Estates 3 31 Brighton & Sussex Universities Hospitals NHS Trust 1 Rank PID Project Name SOUTH EAST Heatherwood Hospital redevelopment SCOTLAND Orkney Campus Health Care Facility Value ( M) Details Date: Mar 2 Mar Funding: Mixed Contractor Kier Southern Limited Date: Mar 2 Mar 9 Funding: Public Contractor Robertson Group Limited Head Office 1 BDP Norr Pozzoni Design Group Keppie Design Murphy Philipps Architects Limited 3 56 Key Architects SCOTLAND Anchor Centre Foresterhill Campus NORTH WEST Rutherford Cancer Centre North West The Clinic Main Hospital Site Quantum Leap Project Phase Date: Jan 2 Dec 9 Contractor John Graham Construction Date: Jan 2 Jan 9 Funding: Public Contractor Interserve Building Limited Date: Nov 2 Nov Contractor J Coffey Construction Limited 6 IBI Group Jane Darbyshire & David Kendall P & HS Architects Gilling Dod Architects 7 Tangram Architects 2 1 Kier Construction Limited-Building UK 2 2 Interserve Plc 2 3 Robertson Group Limited John Graham Construction Limited Vinci Construction 2 3 Key Contractors Cleveland Clinic WALES Cardigan Integrated Health and Social Care Centre WALES Dogs Trust Rehoming Centre Cardiff SOUTH EAST The Avenue Care Facility & Care Home SOUTH EAST Kent Medical Campus, Newham Park Cygnet Hospital Maidstone Date: Jun 2 Jun 9 Contractor Laing O'Rourke Head Office Date: Jul 2 Jul 9 Funding: Public Contractor Interserve Building Services Date: Jul 2 Jul 9 Contractor McPhillips (Wellington) Limited Date: Oct 2 Oct Contractor Highwood Group Date: Jan 2 Jul 2 Contractor Metnor Construction Limited 6 ISG 3 7 J Coffey Construction Limited 2 8 Wates Construction Limited 1 9 Laing O'Rourke 1 2 McPhillips (Wellington) Limited 1 The ranking tables are compiled from Barbour ABI database and are based on the total value of contracts awarded over the previous month period. The values represent the construction cost of each project

25 % % EDUC AT I O N tops the regions in 2 Contract awards decline by.7% in 2 East Midlands West Midlands EDUC ATION 9.1 Planning pipeline shows only marginal improvement but programmes such as PSBP should provide opportunities in the medium-term..1.3 Value of contracts by region 8 Contracts awarded in the education sector totalled 5.8 billion in 2, an.7% decrease on valued recorded for 2 (see fig. 9.2). This marks the third consecutive year of decrease with contract awards values having decreased by.5% since the peak of 7.8 billion in 2. However, the education sector is underpinned by a number of renewal and refurbishment programmes for the existing estate which should provide a stable platform for some construction output growth into the medium-term and beyond. 7 The sector decreased for the third year in a row, however the outlook looks positive for education construction in 2 as renewal and refurbishment contracts look to come in abundance Decrease on 2 2.7% EDUC ATION Project value 2

26 EDUC ATION Projects by region Outlook The region had the highest proportion of education contracts awards by value in 2 with.3% of the total value of contracts awarded, up from.8% in 2 (see fig. 9.1 & 9.4). The largest individual contract in the region was the 7 million redevelopment of the Life Sciences building at the University of Sussex. accounted for.% of contract awards in 2, a 5.6% decrease on 2. Key projects in the area included a 36 million project to provide a new secondary school and sixth form at the former Sutton Hospital site. accounted for.2% of contract awards value in 2, an increase of 7.1% on the previous year. The largest education project award in was the 8 million Translation Research Facility for Cardiff University. Although there has been a slight upward movement for education projects reaching detail planning stage in 2, the outlook for construction output remains that of steady growth. The sector is dependent upon public spending for a large proportion of the primary and secondary school estates and limits placed on capital budgets will influence the level of construction output into the medium-term. A We may see an influx of university projects in 2, as institutions look to grow their estates as the higher tuition fee alongside the removal of the cap on student numbers could provide a positive outcome for construction. Nevertheless Brexit may play a part as EU student numbers may well be affected % Increase in the value of projects at advanced planning stage compared to 2 EDUC ATION 9. 3 Contracts at advanced planning EDUC ATION 9.4 Change of activity by region (since 2) 6 Planning activity in the education sector in 2 showed a small increase with the total value of schemes reaching advanced planning stage at 5.1 billion in the year (see fig. 9.3). This is an increase of 2.1% and indicates some stability returning to the sector following declines of.5% in 2 and.1% decrease in 2. by the Brexit process, particularly in terms of EU student numbers wanting to take up places at UK universities. In addition, questions remain as to the longer-term viability of some of the collaborative education research programmes which has seen UK universities benefit from EU funding for the provision of new R&D facilities. 7 Detail planning number of programmes exist that will underpin existing levels of output and include the Priority Schools Building Programme as well as the Further Colleges Programme. The removal of the cap on student numbers as well as the increasing number of universities now accessing institutional lending should provide impetus for construction output in this sub-sector. However, some universities could be affected 8 Contract awards decline by.7% in 2-3.1% East Midlands +3.6% -1.1% -2.6% -5.6% +7.1% +4.% -.4% West Midlands +2.5% +.4% -4.6% +7.1% Top Ten Increase for HOTTEST REGION compared to 2 CLIENTS, ARCHITEC TS, CONTR AC TORS & PROJEC TS

27 EDUCATION Contract awards decline by.7% in 2 1 Cardiff University Department For and Skills Funding Agency 7 Key Clients Projects Contract awarded December 2 4 Bournemouth University Powys County Council Essex County Council 95 7 University of Glasgow Leeds Beckett University The University of Sheffield 4 73 Tauheedul Trust Hawkins Brown Architects HOK International Limited 4 3 Stride Treglown Limited 9 4 Atkins 7 5 Sheppard Robson AHR Building Consultancy Limited 4 7 Bond Bryan Partnership 9 8 ADP 4 9 Scott Brownrigg Limited 9 6 Key Architects Rank PID Project Name SCOTLAND Forth Valley College Falkirk Campus SCOTLAND Inverurie Academy s School for the Future SOUTH EAST Brighton College Sports and Science building NORTH WEST Manchester Metropolitan University Arts & Media Project SCOTLAND Glasgow, University of Glasgow Learning and Teachers Hub SCOTLAND University of Glasgow Glasgow Research Hub Value ( M) Details Date: Nov 2 Nov 9 Funding: Public Contractor Balfour Beatty Construction Services UK Regional Office Date: Jul 2 Jan Funding: Public Contractor Robertson Group Limited Head Office Date: Aug 2 Aug 9 Funding: Public Contractor McLaren Construction Limited Head O ff i c e Date: Oct 2 Oct 9 Contractor Morgan Sindall (Construction) Plc Date: Nov 2 Nov Funding: Mainly Private Contractor Multiplex Date: Jan 2 Jan Funding: Public Contractor Multiplex Feilden Clegg Bradley Architects YORKSHIRE & HUMBER Leeds City College Building Phase 1 36 Date: May 2 Jun 9 Funding: Public Contractor Wates Construction Limited 1 Kier Construction Limited-Building UK Willmott Dixon Construction Limited BAM Construction 4 4 Morgan Sindall Plc Galliford Try Construction 4 6 Wates Construction Limited 1 Key Contractors WALES Cardiff West Community High School WALES Croesyceiliog Comprehensive School redevelopment New Sutton Passivhaus Secondary School Date: Jun 2 Aug 2 Funding: Public Contractor Willmott Dixon Construction Limited Date: Jan 2 Sep 9 Funding: Public Contractor Kier Western Limited Date: Jan 2 Jul 9 Funding: Public Contractor Willmott Dixon Construction Limited 7 Balfour Beatty Group Limited 5 8 Vinci Construction Robertson Group Limited 6 9 Multiplex 3 9 The ranking tables are compiled from Barbour ABI database and are based on the total value of contracts awarded over the previous month period. The values represent the construction cost of each project

28 Bespoke Research and Consultancy We put more into our research you get more out AMA Research is a specialist provider of market research and insight to the UK building and construction industry. We offer a wide range of research and consultancy services to support and inform strategic decisions, based on over years experience in the sector. Our approach is pragmatic and straightforward, resulting in relevant recommendations, solutions and advice. Research services include: Market size, trends and market forecasts Benchmarking studies Competition reviews Distribution opportunities and threats in new and existing markets Organisational due diligence and acquisition studies Buying and specification processes Quantitative and qualitative attitudinal research New product assessment and feasibility Get in touch now to find out how we can help your business. sales@amaresearch.co.uk

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