New contract awards bode well for levelling up regions

If the government is looking for signs that its levelling up agenda is making headway, it could do worse than look at the latest Glenigan data for new construction contract awards for the fourth quarter of last year.

It shows that some of the UK’s traditionally less prosperous regions - notably the North East, the South West and Scotland - benefitted from a flurry of significant new contract awards which bodes well for local construction activity in 2022.

Meanwhile, the West Midlands, Yorkshire and the East of England also saw a healthy level of new construction work. All three areas saw main contract awards worth over £2 billion in the final quarter; in each region this was up 12% on the same period a year earlier.

Spectacular end to the year

The North East enjoyed a spectacular end to the year with all main contract awards worth £3,377 million in the fourth quarter, an almost three-fold increase compared with the previous three months and on the final quarter in 2020. The North East also showed a healthy pattern of underlying main contract awards - for projects valued at under £100 million – which were worth £1,128 million in the fourth quarter, up by 63% on the period a year previously.

Newcastle’s revival as a commercial and leisure centre continues to provide a promising source of new opportunities for construction contracts. One key project to get underway recently was Phase 2 of the £140 million Motcombe Masterplan, which involves new office buildings with space for a café, restaurant, and bars. Bowmer & Kirkland is the main contractor on the project where work is set to continue until 2025 (Project ID: 19040191).

Elsewhere in Newcastle, outline plans have been granted for a major £250 million residential, commercial and leisure development at Quayside West. The scheme is at the pre-tender stage and will eventually involve up to 1,500 homes, a hotel and over 10,000 sq m of commercial, community and leisure space (Project ID: 18228602).

Opportunities in the pipeline

The South West of England also ended the year on a flourish with the value of all contract awards rising to £2,706 million in the fourth quarter, an increase of 65% on the period a year previously.

There are also some major opportunities in the pipeline for new work in the South West. A ‘scoping request’ has recently been submitted to South Gloucestershire Council for the huge £250 million Brabazon Masterlead development on the former Filton Airfield site outside Bristol which will involve 6,500 homes, three hotels, nurseries, schools, and commercial units. The scheme is at the pre-tender stage and work could start later this year (Project ID: 22003313).

Meanwhile, contractors in Scotland are also set to benefit from a healthy flow of new construction orders. All main contract awards were worth £2 071 million in the fourth quarter, up 40% on the period a year previously.

Prominent contracts which have recently been let in Scotland include Albany Park, the £70 million student accommodation extension at St Andrews University where Morgan Sindall Infrastructure is the main contractor and work is set to start this spring and run for 13 months (Project ID: 15366312).

There are also some significant new construction projects in the pipeline in Scotland. Glenigan data shows that detailed plans have been granted for the £500 million Edinburgh Park Southern Phase project, involving over 1,700 flats along with commercial, restaurant and medical space. The scheme is at the pre-tender stage and work could start in the late summer of this year (Project ID: 18087458).

Glenigan customers can see details of construction opportunities in the North East, the South West and Scotland if part of your subscription.

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