Strong housing pipeline fuels South West construction growth

The South West construction industry is poised for continued growth, with a strong pipeline of private housing projects driving a 16% increase in the underlying value of construction project starts (schemes valued up to £100 million) in the three months to July 2024 compared to the previous quarter.

Glenigan’s construction industry intelligence has also identified another 2,659 projects with planning permission that are due to start on site in the next 12 months. The largest amount is in the private residential sector, where there are 1,141 schemes due to begin in the next year.

This includes Persimmon’s Regents Village in Cheltenham (pictured) with work on the first phase of 266 units due to begin in September (Project ID: 20231466), and David Wilson’s Honeymans Helm at Highworth near Swindon, where work on 250 homes should commence before the end of 2024 (Project ID: 19359096).

Student housing

With a number of universities across the region, there are also a significant number of student accommodation schemes in the pipeline and due to commence in the next year.

These range from a £5 million refurbishment of the University of Exeter’s existing halls of residence at Stocker Road (Project ID: 24095884), to a £41 million development of a student cluster of flats and houses at Freestone Road in Bristol, where work should begin by the end of this year (Project ID: 19115050).

Industrial workload

Outside of residential work, the industrial sector has the next largest number of projects due to begin.

388 industrial schemes with planning permission are ready to start over the next 12 months include the Panattoni Honda Site in Swindon with a £223 million package due to begin in January 2025 (Project ID: 21207562).

Other planned developments include seven warehouse units at Stoke Road in Bishop’s Cleeve (Project ID: 23378633), where Glenigan’s market research suggests work will begin in January, to plans for half a dozen industrial units on a former Proctor & Gamble site in Bournemouth with a contractor currently being procured (Project ID: 23009451).

South West Top 10

Kier has won the most work in the South West over the past year with an order book valued at £248.3 million according to Glenigan’s construction market research. This haul includes a £65 million scheme for the University of Bristol to convert a former Hewlett Packard office into a healthcare training facility (Project ID: 24160583). Work is expected to commence in November.

South West – Top 10 contractors August 2023 to July 2024

Source: Glenigan

Regional contractor Beard, which has offices in Bristol, Swindon and Southampton, is ranked second after bagging contracts worth a total of £162.1 million in the 12 months to July 2024. This includes a £20 million deal for Beckery Island Regeneration Trust to convert the former Baily’s tannery and leather working factory in Glastonbury into a multi-use workspace (Project ID: 22372517)

A return to contracting through the increased specification of modular building on healthcare projects lifts Shepherd into the regional Top 10 in seventh. The York-based group, which sold its original construction division in 2015 to Wates, has £74.1 million-worth of work in the South West region including a £49.9 million Elective Care Centre scheme at Southmead Hospital in Westbury-on-Trym (Project ID: 22282927).

South West sustenance

A strong pipeline should sustain opportunities in the South West in the near term.