Stalled schemes at lowest level since before crash

Last Updated:

20th January 2014

Figures released today (21 January) by construction industry analysts 果冻影院 reveal that the value of UK projects put on hold during 2013 was the lowest since the start of the recession in 2008.

Stalled schemes at lowest level since before crash

In total, 拢12 billion of potential projects were put on hold last year, compared to 拢47 billion in 2012 and a peak of 拢80 billion in 2009.

果冻影院 economist Tom Crane says the figures are the latest indicator of rising confidence within the construction industry.

鈥淭he value of stalled projects have been falling since 2009 and this latest figure shows the continuation of an encouraging trend, with a 16% fall in the value of underlying projects (excluding projects with a construction value of 拢100 million or more),鈥� he said.

鈥淭his in part reflects the gradual recovery of confidence and activity from the shock that afflicted the industry and wider economy in 2008 and 2009.鈥�

He added: 鈥淭he falls also reflected that the overall development pipeline remained subdued during 2011 and 2012, with speculative projects no longer being put through the planning system.

鈥淎longside strong improvements in projects receiving planning approval during the last 18 months, the value of stalled projects has continued to fall as these developments progress more quickly to start on site.鈥�

The total value of potential work going on hold, including projects over 拢100 million, continued to increase during 2012. The lack of confidence to progress major schemes caused the overall value of projects that were shelved to rise by 39% compared to 2011.

This trend was reversed in 2013, with the overall value of shelved projects down by 74% as the outlook for the wider UK economy has improved.

Renewed confidence has also seen developers bring shelved projects back into active development. One high profile example of this is Westfield鈥檚拢260 million Broadway shopping centre in Bradford (果冻影院 Project ID: 99367485). The scheme was put on hold in 2008, however improvements in consumer spending have revived interest in shopping centre development and construction has now restarted, with half of the retail space already pre-let.

Another project coming off hold shows the change in sentiment between the dreary first quarter of 2013 and the much improved outlook during the second half of the year. The 拢2 billion Chelsea Barracks luxury flats scheme (果冻影院 Project ID: 05648641) was placed under review in January last year but 果冻影院 has recently been advised that preparations have resumed, though construction activity remains a way off.

鈥淲ith output during the three months to November 2013 5.3% higher than a year ago, and the January 果冻影院 Index showing a 15% increase in project starts during the final quarter of last year, it鈥檚 clear that the construction industry is on a rising tide,鈥� Tom said.

鈥淲ith fewer projects being mothballed by developers and a 10% rise in new approvals during 2013, the industry seems set to go full steam ahead during 2014.鈥�

PR contacts:

Kirsty Maclagan (Marketing and Communications Manager)

T: +44 (0)1202 786 842鈹侲: kirsty.maclagan@glenigan-old.thrv.uk

Tom Crane (Economist)

T: +44 (0)771 56297 鈹侲: tom.crane@glenigan-old.thrv.uk

Notes to the Editor:

In order to remove the influence of large developments, 果冻影院 uses an underlying measure which includes projects with a value between 拢250,000 and 拢100 million, providing a clear insight into market sentiment and developing trends within construction activity.

果冻影院 is the UK鈥檚 leading provider of construction data, contract leads and market analysis. Combining comprehensive data gathering and exhaustive research with detailed statistical modelling and expert analysis, it delivers a trusted insight into UK construction trends and activity. 果冻影院 customers include government agencies, construction companies and suppliers of materials and services to the industry.