A significant increase in the pace of construction across the north of England is being powered by ongoing investment in the hospitality and residential sectors, new data has revealed.
According to the latest figures from Deloitte, construction pipelines are burgeoning in the major hubs of Birmingham, Leeds and Manchester, with new developments helping to boost the attractiveness of major investment schemes across the region.
Rapid growth for major city developments
The Northern Powerhouse initiative gained considerable momentum in 2017 and has been cited as one of the major drivers of sustained redevelopment across the region during recent months.
Indeed, Deloitte’s data shows that in Birmingham alone there are now more than 4,000 residential properties currently under construction, in addition to 1.4 million sq ft of commercial office space.
The construction of new purpose-built student accommodation is also rapidly increasing across the city, with a more than one-third uplift in bed spaces to over 1,300 in 2017. Meanwhile, hotel bed completion rates exceeded 330 last year, marking the strongest annual performance for the Birmingham market since 2013.
Elsewhere in the north of England, Leeds too is benefiting from an invigorated construction pipeline, with the highest recorded level of residential property growth since 2008 (1,586) seen in 2017, and the highest annual number of delivered hotel beds (385) ever recorded.
Finally, the Deloitte Crane Survey shows that the figures are even stronger for Manchester, with more than 11,000 residential properties currently under construction across 41 separate developments – marking a 60 per cent increase in residential sector output during the last year.
What’s more, Manchester’s retail and leisure industries continues to attract considerable investor interest, with a four-fold upturn in delivered space (62,557 sq ft) in 2017.
Increased construction efforts across the UK
Overall, regional markets across the whole of the UK are delivering outstanding returns and incentives for investors in the current financial climate, but new official market data also shows that construction efforts across the whole of the country are growing at present.
Figures published as part of the latest IHS Markit/CIPS UK Construction Purchasing Managers Index (PMI) have shown concerted growth in construction pipelines in recent months.
Tim Moore, associate director at IHS Markit and author of the IHS Markit/CIPS Construction PMI, stated: “Total new orders picked up at the fastest pace for seven months in December, which provides a positive signal for construction workloads in the short-term. Resilient demand and forthcoming project starts also led to greater job creation and the strongest increase in input buying for two years.”
The PMI figure stood at 52.2 in December 2017, highlighting significant growth within the UK’s construction sector. Indeed, any figure above 50 denotes a rise in value for the market, and this latest result represents a 16th consecutive month of upward momentum.
Northern construction uplift leading to investor opportunities
Positive sentiment therefore continues to surround UK construction activities at present, especially in the north of England, as we’ve seen. This, in turn, helps to create the potential for significant gains for those entering the market and, at Experience Invest, we continue to offer a wide range of investment opportunities for our partners.
Indeed, we have major new developments in the pipeline for cities including buy-to-let apartments and hotel suites in Liverpool and Newcastle student accommodation investment this year, among others, meaning there is plenty of scope for this ongoing positive sentiment to further bolster gains for our clients in the months ahead.