Barbour ABI’s latest Economic and Construction Market Review shows that the value of commercial and retail construction contracts totalled £5.3bn, a 4.9% increase from July and 16.6% on the value recorded in August 2013.
The report also showed that the value of construction contracts awarded in London totalled more than £1.6bn in August, accounting for 30% of the overall contracts awarded UK-wide.
Residential had the highest proportion of contracts awarded by value in August with 30% of the total, demonstrating the continuing strength of the residential sector within the industry.
The commercial and retail sector also featured prominently this month accounting for 26% of the total value of all projects with infrastructure (16%) and education (14%) the next highest sectors this month by value of contracts awarded.
But the number of construction projects within the UK in August decreased by 22.4% on July, and is 0.4% lower than August 2013.
On the findings of the report, Michael Dall, lead economist at Barbour ABI, commented: “Commercial and retail construction has seen a real resurgence recently. This is mainly due to big ticket projects in London and further afield, such as the £420m contract for 10 Fenchurch Street and £100m commercial developments in Branston, Staffordshire and Botley, Oxfordshire respectively.
“Once again, offices were the dominant type of project in the sector, accounting for 71% of the value of contracts awarded in August, with general retailing at 23%. Looking ahead, the sector should continue to prosper as long as the capital remains an attractive proposition for investors.”
The majority of the contracts awarded in August by value were in the London and the south east, which accounted for 30% and 12% respectively of the UK total.
Apart from the Fenchurch Street commercial scheme in the City of London, a significant residential project worth £130m was also awarded in London this month called City North Development in Finsbury Park.
Elsewhere, major contracts awarded in August included a £150m green power plant in Hull, awarded to Spencer Group. In Newcastle, the £100m Newgate Centre Development was awarded to McAleer and Rushe.
