Resilience to recovery: The future of UK construction
Resilience to recovery: The future of UK construction
Section 3
Political uncertainty and government support At the time of writing, the prevailing view is that a general election will be called some time towards the end of 2024. And our results show that political uncertainty around this is having a direct impact on business’ plans. Just over three-quarters (76%) of the firms we surveyed said it was causing them to delay investment or causing their clients to delay commissioning new work. Some of this is likely to stem from the fact that key policy positions from the major parties are still – in many cases – being developed, including in areas like infrastructure and the green economy. Added to this, even once the result of the election is known, it will still take some time to see how much of what is planned can actually be delivered and how markets and the economy will fare – factors that will particularly affect the outlook for residential and commercial operators.
“While their value and aims are recognised and supported by the industry, post-Grenfell safety measures are having a big effect on some developers, particularly in urban areas. For example, any new buildings over 18 metres tall now must have two staircases. “Not only is there the time and cost to do the redesign, but adding another staircase also means you lose net saleable area. Even though there will be a ‘grace period’ before these regulations are enforced, there will be many developers who have got schemes where the maths now just doesn’t add up, and I expect the sector will be feeling the impact of this over the next year or two. “At the same time, most large organisations, whether they’re contractors or developers, have a number of historic legacy projects, some of which will be impacted by the investigations and remediation work that has been done post-Grenfell. That will include both tall buildings and housing, where fire stopping historically hasn’t been installed correctly or the wrong materials have been used. Developers are having to go back and put things right – at their cost – which may affect investment plans elsewhere. “Separately, such widespread reports of political uncertainty also reflect the impact that elections have on big decisions, such as planning or infrastructure investment. Politicians are likely to delay anything that could be divisive or politically ‘dangerous’ when there is an election looming. In the period leading up to any election there’s also a period of purdah, where big decisions are put on hold. In this environment, firms may need to pause on their strategies while they wait for this landscape to unfreeze.” Ross Faragher, Property Development Consultant and Interim Executive
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