Commercial and retail construction contracts increased by almost 70% in February according to figures released 19 March, 2015.
The value of projects awarded topped £1.1billion in February which is 67.9% higher than this time last year and over a third (35.4%) higher than in January 2015.
Contracts for key projects such as the Pinnacle Building in the City of London were a major contributor to the surge and led to office projects accounting for a sizeable 70% of all commercial and retail contracts awarded in February. Last month also saw a marked increase in the food-retailing sector, with projects making up 19 per cent of works handed out – a 10% increase on February 2014.
Commenting on the figures, Michael Dall, Lead Economist at Barbour ABI, said: “It’s good news that commercial and retail construction is on the up as, sector-wise, it is the second biggest contributor to the overall industry in the UK after housebuilding. Last month for example, it was widely reported that the decline in ONS Construction Output was because of a reduction in house-building, but it was in fact a dip in commercial and retail contracts that was mostly responsible for the downward trend.”
The report by Barbour ABI, which supplies construction data to the Office for National Statistics (ONS), Cabinet Office and Treasury, also noted regional trends in commercial and retail construction activity, many of which go against the comments made by the Chancellor yesterday that the UK is experiencing a ‘truly national recovery’.
Michael added: “Overall there has been a surge in commercial and retail construction, but this boom is still very much led from the capital. In fact, London saw a 16.1% increase in project value versus February last year, which far exceeds any other region. The West Midlands, for example, was next line at just 3.7%.”
These latest figures are taken from the Barbour ABI Economic & Construction Market Review, a monthly report designed to give valuable insight into UK construction industry performance. It is compiled from Barbour ABI’s records of construction data for every UK planning application, and key indicators, such as the Office for National Statistics’ Construction New Orders data.