CONSTRUCTION SECTOR OVERVIEW
WHILE INVESTMENT IN WATER AND SEWERAGE INFRASTRUCTURE REMAINS A CONCERN, RIDER LEVETT BUCKNALL FORECASTS A STEADY CONSTRUCTION MARKET FOR THE YEAR AHEAD… Bid opportunities increase across the public sector
Northern Ireland’s construction industry is feeling generally optimistic for the coming year, according to the latest Construction Market Intelligence (CMI) report published by consultant Rider Levett Bucknall (RLB UK). Following restoration of devolved government and agreement on a draft programme for government with a focus on growing a globally competitive and sustainable economy, the findings suggest a steady market for the year ahead. There is a noticeable increase in the number of bid opportunities across the public sector, particularly in the education and infrastructure sectors, with repair and maintenance projects expected to record the fastest rates of growth. The continuing need for infrastructure investment across water and sewerage systems remains a concern and is impacting the delivery of new projects in Belfast. The Irish government’s commitment to spend £675m on shared island investment priorities such as transport infrastructure has already begun to filter into NI, said RLB UK. Planning approval timescales remain steady across local authorities. Investors and developers are mostly aware of the isolated planning issues that exist and remain positive about progressing their projects. The current planning system requires a number of policy changes to enable Northern Ireland to meet its renewable energy targets. A ‘STABLE UPWARD TREND’ IN TENDER PRICES FORECAST Tender pricing has stabilised over the past quarter with a return to more typical increases in inflationary levels expected, at least in the short term, said RLB UK. As for the long-term outlook, a stable upward trend in prices is forecast - but with some local spikes due to the chronic skills and labour shortages that exist in Northern Ireland.
Alpha Housing’s sheltered and affordable accommodation complex, which RLB was instrumental in helping deliver.
SECTOR FOCUS Education: The education pipeline is increasing. The shared education campus at Ballycastle has been approved and will likely stimulate other developments. To tailor the procurement process, the Education Authority Framework for the Appointment of Integrated Consultant Teams for Above UK Procurement Threshold Construction Professional Services is to be released following extensive pre-consultation and workshops events. Healthcare: While capital budgets have yet to be approved, the focus of the NHS continues to be on maintaining and retrofitting existing assets to ensure the operational stability of buildings. Infrastructure: Preliminary works have commenced on the A5 North-West road link, a project supported by the Shared Island Fund to boost cross-border connectivity. Proposals for a long-term rail extension project across Ireland and Northern Ireland are gaining momentum with indicative routes shared for consultation. Public and civic: Budget cuts have been
offset by news that £60m of Belfast Region City Deal investment has been unlocked with the signing of contracts for funding for three significant tourism projects, including Destination Royal Hillsborough. Residential: Northern Ireland’s social housing funding pot has been reduced by 60% for this year. There is continued interest in purpose-built student accommodation development opportunities in Belfast. Retail: The retail sector’s focus remains on refurbishment of existing assets, rather than new builds. As a result, a spike has been seen in contractors’ fit-out costs. Out-of-town shopping centres remain an attractive option for investors following several high-profile transactions. Sport: The redevelopment of Casement Park has not yet been approved with funding discussions ongoing. Investment has been secured for a number of Irish Football Association projects. To view RLB’s full CMI report for Q3 2024, visit: www.rlb.com/europe/ insight/construction-market-intelligence- uk-edition-q3-2024/
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