UK construction and property
- Forecasts | The Construction Products Association has revised its forecasts for 2023 and 2024 to -6.8% and -0.3% respectively (its previous view was -7.0% and 0.7%). Despite recent cancellations and rephasing, they anticipate infrastructure activity will remain at its high level, due to continuing work on Phase One of HS2, the Tideway Tunnel, and Hinkley Point C. New housing, and repair and maintenance of housing are expected to fall due to increased interest rates and falling confidence. Overall, it warns that the construction industry is likely to remain in recession until the start of 2025.
- Property fund | M&G is to close its property fund which has been affected by persistent outflows from UK retail investors and “declining interest.” The fund has been suspended twice in the last seven years. M&G currently has over £500m of property assets.
- Hotels | Travelodge has announced plans to build 100 new hotels across London stating that there is a shortage of “good quality and low cost accommodation”. The move will more than double Travelodge’s stock in London.
- Pay | Engineering construction workers – who are covered by the National Agreement for the Engineering Construction Industry – have voted to strike, having turned down a pay deal of 8.5% for 2024 and 3.5% for 2025. Union members say that their pay has fallen 20% behind inflation. The strike could affect work at several oil refineries and Sellafield nuclear facility.
- Construction wages in August were 4.2% higher than a year earlier, according to the ONS, but fell 2.9% compared to a month earlier.
- HS2 land |Sir John Armitt, chair of the National Infrastructure Commission has said that selling the land acquired for Phase 2 of HS2 would be a “mistake” and that it should be retained for at least two years to allow revisiting the plans and finding a more cost-effective solution.
- Planning reforms | A cross-party committee has warned that draft planning revisions to major projects do not provide legal certainty and urged ministers to re-write sections that determine whether a project is compatible with net zero legislation. Reforms to the National Networks National Policy Statement are intended to prevent legal challenges which have delayed major projects in the past.
- Hospitals | The government has updated the list of NHS estates containing reinforced autoclaved aerated concrete. A total of 42 sites have been identified so far and £698m has been set aside for remediation and failsafe measures.
- Use less? | National Highways is to cover an integral bridge (with no expansion joints) on the M25 with gauges to measure the actual strain and stress profiles to see if the bridge could have been built with fewer materials. National Highways says the investigations could transform the construction of future bridges, and significantly reduce costs.
- Infrastructure | The National Infrastructure Commission’s second assessment calls for a “new approach” to delivering national infrastructure, and that the UK needs to invest much more into its infrastructure, with public transport, home heating and water networks in need of renewal. Civil engineering contractors supported the stance, encouraging political parties to take on board the commission’s recommendations.
- Housing | It is rumoured that the Autumn Statement may introduce measures to support first-time buyers, extending its mortgage guarantee scheme which allows buyers to take out a mortgage with a 5% deposit.
