The global economy is in an incredible state of flux, with a variety of pressures affecting construction confidence and pricing in the UK.
In our latest London Real Estate Market report ‘From chaos to creativity,’ we give our view on the current landscape and advise how businesses can mitigate the risk.
Project teams must review their own allowances in the light of these risks – whilst focussing early and continually on mitigation measures, staying close to the supply chain and getting the basics right.
The chaos and complexity of the last few years will require the industry to put their creative skills to the test, resetting future building typologies to meet current challenges.
Three key drivers are currently influencing how the construction industry operates:
- A difficult balancing act – policymakers around the world remain locked in the battle between encouraging economic growth and combatting inflation.
- A softening market but hardening costs – resource constraints and cost pressures are the reason why we cannot currently see deflation in London construction prices, merely a reduced rate of price increases.
- New beginnings and new rules: a reset – real estate is confronted by some existential challenges, namely the climate emergency, the move to hybrid working, and regulatory reform. These challenges, also represent opportunities, and so it feels like we are on the cusp of a reset, one that will reimagine our buildings, and our approach to designing and building them.
Our research is supported by a thorough overview and analysis of the UK economy and London construction sector, wage pressures, and material prices.
Despite the challenges the industry faces, the future looks positive. The sector is changing to create the right responses to the climate emergency, to reflect new ways of working, and to learn the lessons of catastrophes such as the Grenfell Tower fire. Creativity will be required in producing the next generation of buildings which are sustainable, flexible, and safe.
Read the full report here.
For more information, please get in touch with the team:
- Rachel Coleman, Associate Director, Research Analyst (Rachel.Coleman@ttalinea.com)
- Michael Cracknell, Director (Michael.Cracknell@ttalinea.com)
- Mark Lacey, Director (Mark.Lacey@ttalinea.com)
- Steve Watts, Director (Steve.Watts@ttalinea.com)