Chartered Institute of Building Magazine of the Chartered Institute of Building
  • 5 Jan 2017

Vox pop: How will corporate activity pan out for construction this year?

Kevin Cammack, analyst, Cenkos Securities

I think next year will as difficult if not more than this year. Unless you’re filling your order books with big high-profile infrastructure projects or jobs such as HS2, then you’ll find it difficult.

We’ve seen a number of smaller companies go under this year, I think we’ll continue to see this in 2017. If you’re a £50m turnover contractor, you’re not going to be able to bid for the large infrastructure projects you need to. They’re operating in the building market, rather than the infrastructure market where they need to be.

As for mergers next year, history shows that the best time to buy assets is sometimes from the receiver, rather than a takeover or buying before this stage.

Richard Threlfall, UK head, infrastructure, building and construction, KPMG

2017 will be a year of feast and famine for the construction industry. Infrastructure contractors will be getting fatter as HS2 and a further raft of road schemes get underway; commercial contractors will be going on a diet as corporate demand plays the Brexit Blues.

But an industry divided by demand will be united by the common challenge of rising materials prices, already responding to the fall in the value of sterling; ongoing skills shortages; and the opportunity to gain commercial advantage by embracing technology.

Paul Tremble, executive director, WSP | Parsons Brinckerhoff

The construction industry heads into 2017 at a crossroads. On the one hand we are still waiting to see what impact Brexit will have, if any, on the economy. On the other hand we are witnessing from the Autumn Statement a government that values both long-term, strategic projects such as Heathrow and Hinkley as well as quicker wins in local highways to pick up any potential slack.

At a corporate level this uncertainty may result in a stalling in sector consolidation. However, a fall in the pound will have its consequences: firms are going to be more attractive to foreign buyers, and so are UK projects that require outside investment.

Chris Jones, associate director, project & building consultancy, Colliers International

2017 will continue to be a challenging year for the industry in the wake of Brexit. Donald Trump’s election in the US could add further uncertainty in 2017.

The central London commercial and investment sector continues to suffer due to post-Brexit loss of confidence. Foreign investment in central London is also wavering as the pound remains weak against the euro and the risk of the UK’s removal from the single market could potentially put off overseas long-term investment in UK construction projects.

Martin Vella, managing director, Pexhurst

The key word for construction companies is going to be flexibility, with contractors needing to adjust to market demands as and when they arise.

There is a strong chance that US investors will fuel a large amount of construction at the lower-to-mid end of project values, particularly when it comes to commercial property refurbishment.

As contractors we will need to demonstrate the ability to engineer value out of projects, especially on contracts which are already out to tender.

Leave a comment


12 January 2017 Changing the industry starts with offsite

05 January 2017 Vox pop: How will corporate activity pan out for construction this year?

02 January 2017 Leader: Here's to a healthier and more productive 2017

01 January 2017 Tools alone won't change our culture

21 December 2016 The Bonfield Review: Better late than never?

21 December 2016 Chris Blythe: Why we're still stuck on the runway

21 December 2016 Is it time to switch off for the New Year?

27 November 2016 Productivity focus is vital to prepare for Britain's post-EU world

24 November 2016 Do the figures stack up in Hammond's Autumn Statement?

24 November 2016 BIM is at the heart of solving industry's problems

22 November 2016 Why we need to practise inclusiveness to get the most from our workforce

17 November 2016 Chris Blythe: We need a dynamic industry, not another report

15 November 2016 Brexit leaves Govt Construction Strategy in limbo

14 November 2016 Trump victory to cause uncertainty on both sides of Atlantic

10 November 2016 What's the future for renewables under Trump?

08 November 2016 RIBA clients survey: Architects must understand contractors' needs

08 November 2016 Vox pop: What does the US election mean for UK construction?

01 November 2016 Leader: It's within our power to change the industry

30 October 2016 Housing policy takes a pragmatic turn

25 October 2016 How construction technology can play starring role in TV and film