HS2 sparking wider regeneration
Phase 1 of the HS2 project is set to play a key role in parts of Great Britain where HS2 hubs will be built, unlocking an enormous rise in wider regeneration and investment in residential, commercial and infrastructure projects. Five GB regions are reaping the benefits of £7.2bn of work awarded contracts, including West Northamptonshire which had a 200% increase in construction contracts awarded in 2017.
The latest data has come from the ‘Regional Construction Hotspots in Great Britain 2018’ report from industry analysts Barbour ABI and the Construction Products Association, which highlights the levels of construction contract values awarded in 2017 across all regions of Great Britain. Hotspots and coldspots identify the areas where contract awards were significantly above or below previous years, highlighting pockets of activity or contraction.
Haringey and Islington, Hounslow and Richmond upon Thames, Birmingham, Warwickshire and West Northamptonshire are the regions that have been awarded contracts for five new or redeveloped railway lines and tunnels. The new sites and related infrastructure such as stations will be used as a tool to unlock development in wider housing and commercial projects, falling particularly in plan with the government’s strategic objectives in the Housing White Paper to increase housing provision around key transport hubs.
City centres on the route are already taking advantage of the new connectivity. The scale of which saw two residential contracts in 2017 for £77m and £50m for the Bristol Street and Selly Oak developments respectively. Birmingham also received the highest commercial investment compared to the other regions on the route, as well as coming top for infrastructure investment with over £2.8bn of work awarded.
Similarly, the transport hubs have triggered housing hotspots in Haringey and Islington and Hounslow and Richmond upon Thames in 2017, with the regions awarded £100m and £76.5m of housing contracts respectively. Commercial investors have also been attracted to Northampton with a £30 million contract awarded for Four Waterside, which will form part of the region’s new enterprise zone.
Michael Dall, lead economist at Barbour ABI commented:
“The sheer size of the HS2 contracts will have a transformational impact on the amount of infrastructure work over the coming years, and will also create associated residential and commercial construction opportunities. The commercial sector in particular has been challenged since Brexit so it will be interesting to see whether the HS2 development provides a boost to this sector.”
Rebecca Larkin, construction products association senior economist said:
“The first contract awards for work on HS2, a project costing £55.7bn in total, will shore up confidence for investment into the long-term regeneration of towns and cities along its route. As the first city stop on the route from London, Birmingham has been a construction hotspot for two years, and illustrates the potential for infrastructure improvements to unlock projects in the residential and commercial sectors as well.”