The UK construction industry has been seemingly holding its breath ever since the nation voted to quit the European Union. With Article 50 now triggered, there is an opportunity to return to winning ways, according to The Builders’ Conference CEO Neil Edwards.
Nine months after the United Kingdom electorate voted to turn its back on the European Union, Prime Minister Teresa May has finally triggered Article 50, thereby commencing the official countdown to the UK’s departure from the club. It is notable that tens of thousands of people took to the streets of London just a few days before the exit was rubber-stamped in the vain hope that the Brexit decision could be reversed. And there has been a suggestion that large parts of the UK construction sector was experiencing a similar feeling of denial.
According to the BCLive league table statistics across the past six months, it seems that the sector had fallen into a holding pattern, pushing forward to meet demand whilst remaining conspicuously cautious. Indeed, in the first three months of 2017, just a few million pounds separate the monthly totals; just over £4 billion worth of new contracts awards becoming the new norm.
That norm was maintained in March 2017, although it is worth noting the BCLive table reported a small rise in value from the February 2017 total. It is also worth noting that February is the year’s shortest month while March is one of the longest.
Such trivialities will be of little concern to Laing O’Rourke which swept to the summit of the BCLive league table with a haul of five new contract awards with a combined value of £416 million. Key among these were a pair of contracts valued at more than £100 million each. The largest – valued at £155 million - is for the construction of a new tunnel in Battersea as part of the Thames Tideway project. This work will be carried out by a Laing O’Rourke/Ferrovial joint venture. In addition, the company bagged a £106 million contract award for a new office development for Oxford Properties Group in Museum Street, West London.
In second place on the BCLive league table for March was Vinci with three contract awards worth a combined £305 million. The largest of these – won by group company Ringway Eurovia – is a £270 million refurbishment and repair contract for Highways England to improve roads across the South West of England.
A major road contract also helped VolkerWessels climb into the third spot with a combined haul of £207.9 million of new work. That contract, valued at £130 million, will see Birmingham’s M5 Oldbury viaduct receiving a much needed facelift.
BAM landed an impressive haul of nine new contract awards with a combined value of £170.5 million although, as usual, Morgan Sindall surpassed the rest of the field, grabbing 23 new contract awards to claim fifth spot with a £167.7 million monthly total.
With all of the top 10 companies on the BCLive countdown netting new contract awards worth more than £100 million, the monthly league table closed the quarter with a total of 1,827 new contracts recorded with a combined value of £12.83 billion. That compares favourably with the last quarter of 2016 in which the BCLive league table recorded 1,504 new contract awards worth a combined £10.44 billion, and drives the running year total back above the £44.5 billion mark once again.
In a month that was categorised by a continuation of the established norm, the only standout statistic was that Greater London only just past its usual £1 billion+ total. That said, the capital still contributed almost twice the value in new contract awards as its nearest rival (the south west, buoyed by the Vinci contract).
It is still too early to suggest that this reduction in London-based activity is a reaction to Brexit. Indeed, with Article 50 being triggered with just a day or two of the month remaining, the true impact of this momentous decision is yet to be seen. But that decision is final and it is irreversible. The industry’s primary task now, and over the next two years while that divorce is finalised, is to embrace that new norm.
Quick review of BCLive table for March 2017
383 no companies were detailed as winning new construction orders during March 2017
662 no new construction orders are detailed on BCLive
Laing O’Rourke secure overall top spot with £416M of new work
New orders in £1M to £5M category, Morgan Sindall Group came out on top & in the £1M and under category Harmonix Construction Ltd from London were the winners
Morgan Sindall Group plc secured the most number of new construction orders in the month with 23no