Why there is now some rea­son for op­ti­mism in the con­struc­tion sec­tor

Belfast Telegraph - Business Telegraph - - Commercial Porperty - By Trevor Leaker Trevor Leaker is di­rec­tor of ar­chi­tec­ture and en­gi­neer­ing Ire­land, AECOM

The con­struc­tion in­dus­try in North­ern Ire­land fi­nally ap­pears to be get­ting back on its feet. Af­ter years of con­trac­tion and some ex­pan­sion in 2015, the sec­tor en­joyed sus­tained growth of 4.5% in 2016.

More en­cour­ag­ing still is the pre­dic­tion of fur­ther growth this year, de­spite the on­go­ing political and eco­nomic un­cer­tain­ties cre­ated by the out­come of last sum­mer’s Brexit ref­er­en­dum and the cur­rent North­ern Ire­land Assem­bly elec­tion.

This cau­tious op­ti­mism was a cen­tral theme of AECOM’S Ire­land An­nual Re­view of the Con­struc­tion In­dus­try, which was launched in North­ern Ire­land this month and in­cludes the find­ings of a sur­vey of 4,000 peo­ple from across the North­ern Ire­land and Republic of Ire­land con­struc­tion and prop­erty sec­tors.

An­tic­i­pated mod­er­ate growth in 2017 ap­pears to be buoyed by new in­vest­ments from lo­cal au­thor­i­ties and the com­mer­cial sec­tor in Belfast. While the short­age of com­mer­cial ac­com­mo­da­tion in the city looks likely to worsen in the short-term, the sec­tor’s op­ti­mism is per­haps a re­sult of the num­ber of schemes cur­rently un­der­way or be­ing mooted.

Coun­cils, landown­ers and devel­op­ers are also push­ing for­ward with projects that will come to fruition to­wards the end of this year or in 2018, and these should help al­le­vi­ate the short­fall. The range of ho­tel and stu­dent ac­com­mo­da­tion projects pro­gress­ing through the plan­ning process is also a promis­ing sign for the sec­tor.

The de­volved plan­ning process ap­pears to be mak­ing a dif­fer­ence to the speed of de­ci­sion-mak­ing. With plan­ning pow­ers now in the hands of lo­cal au­thor­i­ties, pro­grammes of work are pro­gress­ing swiftly. New in­vest­ments from Belfast City Coun­cil in­clude its £100m-plus leisure trans­for­ma­tion pro­gramme.

While this in­crease in con­struc­tion ac­tiv­ity is en­cour­ag­ing, the skills short­age and ten­der price in­fla­tion re­main key chal­lenges. Both were iden­ti­fied as the biggest risks fac­ing in­dus­try in 2017 by re­spon­dents to AECOM’S sur­vey. The labour mar­ket is show­ing clear signs of short­ages in key trades. At­tract­ing ex­pe­ri­enced crafts­men and en­cour­ag­ing new peo­ple to join the in­dus­try must be a pri­or­ity.

The con­struc­tion sec­tor is right to be op­ti­mistic for 2017 and con­tin­ues to strengthen against a back­drop of un­cer­tainty. With in­dus­try still wait­ing for de­tails on how the UK plans to leave the EU, the fo­cus must re­main on pro­gress­ing key pro­grammes of work and max­imis­ing the ben­e­fits of North­ern Ire­land’s unique re­la­tion­ship with both Great Bri­tain and the Republic.

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