Barbour ABI

Value of new construction contracts down 6.1%

The value of new construction contracts in September reached £5.6bn, a 6.1% decrease compared with August, according to a new report.

The latest edition of the Economic & Construction Market Review from industry analyst Barbour ABI found that September was the second-best performing month of 2018 so far, highlighted by contracts worth over £800m for commercial and retail construction.

The largest project last month was the £187.5m 10 Bank Street mixed-use development in London, almost double the value of the second-largest project.

Three of the four largest projects in September were based in London.

Across the construction sector in that month, commercial and retail projects reached £814m, its best month since July 2016.

Some 75% of these projects were office-led, such as the £60m Lidl headquarters development in Chessington.

Infrastructure and residential both saw decreases last month, 11.7% and 5.9% compared with August.

“The last three months has seen a renaissance for commercial and retail construction, with various large projects commissioned and a growing flow of confidence back into the sub-sector,” said Michael Dall, lead economist at Barbour ABI.

“However, industrial was the only other sub-sector to see any sort of growth in September, as bigger sectors, such as infrastructure and residential, are struggling to break the monthly £2bn contract value barrier consistently, an achievement that was found more regularly in 2017.”

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