Uncertainty Hits Home
The BCLive league table topped the £4 billion mark again this month. But it is what the figures don’t say that is possible cause for concern, according to The Builders’ Conference CEO, Neil Edwards.
The UK economy has endured a prolonged period of uncertainty ever since the electorate voted to quit the European Union and go it alone. But no sooner did the economy heave a sigh of relief with the long-overdue triggering of Article 50 than the economic jitters were kick-started by the sudden and unexpected calling for a snap General Election.
All of this has combined to undermine the UK’s recent economic resilience. The UK economy suffered a sharp slowdown in the opening months of this year, as the post-referendum rise in living costs took its toll on British households and hit consumer spending. GDP growth fell more than expected to 0.3 percent in the first quarter from 0.7 percent.
This is reflected in the BCLive league table for April 2017. While the table topped the £4 billion mark, it did so with 20 percent less contract awards than in March. Indeed, were it not for a single £700 million contract award bagged in the final days of the month, the league table would paint a very bleak picture indeed.
But Persimmon Homes rode to the league table’s rescue, bagging a £700 million order from Haford Care Association for the construction of a new housing development on the Barry Waterfront in South Glamorgan, thereby claiming the top spot on the league table for the first time.
In a distant second was Lend Lease which finally go the green light on the long-awaited construction of a new UK headquarters for US tech giant, Google. That contract is valued at £350 million.
In third place – also achieving a recent high – is Clugston Construction which bagged a pair of contracts with a combined value of £254.4 million. The largest of these – valued at £252 million - is for the construction of a new energy recovery plant at Avonmouth for Viridor Waste Management.
In a year that has been categorised by the rise and rise of the housing sector, Galliford Try swept to fourth spot with an eight contract haul with a combined value of £214.9 million. The largest of these was a £128 million contract award for the construction of 468 new dwellings at Great Eastern Quays in London.
The number of tenders on the BCLive radar screen remains depressed and is currently a third down on the same period last year. And there is a serious danger that this situation will continue for the foreseeable future as the country hunkers down for another General Election. That situation might run even longer as the cabinet reshuffle that will likely follow the election result might drag into Parliament’s summer recess. It could easily be the fourth quarter before any sign of certainty returns.
Quick review of BCLive table for April 2017
279 no companies were detailed as winning new construction orders during April 2017
492 no new construction orders are detailed on BCLive
Persimmon Homes secure overall top spot with £702.8M of new work
New orders in £1M to £5M category, ISG came out on top & in the £1M and under category T&B (Contractors) Ltd from St Albans were the winners
Morgan Sindall Group plc secured the most number of new construction orders in the month with 13no