Spearheaded by strong performances from the housing and hotel, leisure and sport sectors, overall contract value for the construction industry in February reached £6.4bn based on a three month rolling average, a 15.4% increase on the same month last year.
According to the latest edition of the Economic & Construction Market Review from industry analysts Barbour ABI, contracts for housing projects reached £2.7bn in February, the same figure as January 2017, which are the best performing months for residential building since the economic downturn. Coinciding with the strong housing figures, the hotel, leisure & sport sector construction contracts reached £736m on the month, a substantial 105.3% increase compared to February 2016.
Looking across the other sectors within construction; Infrastructure accounted for £1.48bn worth of construction contracts on the month, a 20.8% increase on January. Commercial & retail projects also increased month on month by 17.5% – the highest since September 2016, although values in the sector remain lower than previously when viewed over the longer term. However it was the industrial sector that accounted for the most disappointing figures in February, with a 35% year-on-year decrease and its lowest monthly total since October 2014.
Whilst the value of construction contracts remained very strong on the month, the number of projects saw a decline of 19.6% compared with January. Larger, more valuable projects were commissioned in February, including projects such as a £400m Port of Dover job and the Trafford Park Metrolink extension, valued at £350m.
Commenting on the figures, Michael Dall, lead economist at Barbour ABI, said:
“After recent slumps in the infrastructure and commercial and retail sectors, it was encouraging to see both bounce back and produce encouraging figures in February, alleviating some of the pressure away from housebuilding.
“With the hotel, leisure and sport sector recording its highest construction contract value in years, it will give the sector a well needed confidence boost, thanks greatly to a £400m holiday resort, another major project given the go-ahead in February, a trend that made last month a positive one for construction.”