RLB Wales releases latest report on construction market trends.

Local built environment consultancy, Rider Levett Bucknall (RLB), issued the third quarter of its Tender Price Forecast for 2023 (TPF) report exploring the local effects of the wider national economic situation on construction activity, by focusing on regional perspectives and regional effects across the country.

Here Jackie Pinder, Managing Partner for RLB West and Wales, shares the latest view from the report. “Our latest tender price forecast for Wales, which is a benchmark for construction activity, shows the overall picture continues to feature highly active subcontractors and a busy general contracting market. Cardiff, Newport and Swansea have shown high levels of activity and although some projects are nearing completion, we are seeing replacement schemes starting.” 

Total new construction work value carried out in Wales in the last year is up by 35% on the previous year according to ONS, with the last six months showing an increase of 45% over the same period last year.

The key driver is the large value of work carried out in the new infrastructure sector over the last 18 months, which distorts the overall figures and masks some significant growth patterns in the other sectors. Private new commercial and public non-infrastructure are up over 50% and 38% respectively in the last six months compared to last year, so the market is highly active across a range of works.

The overall picture continues to feature highly active subcontractors and a busy general contracting market, although a potential slowdown in private sector housing development may yet free-up a range of trades operatives.

Other key points:

■ Although total new orders were up over 31% year on year, the comparison of the last six months against last year’s figures shows a fall of 7%. Worst affected appears to be the housing sector, down almost 35%, but the industrial sector is up by over 110%, although this is still a relatively small proportion of the whole market.

■ Private commercial work remains strong, with new orders up almost 33% in the first half of the year.

■ Levels of construction activity in and around Cardiff are still high, although there are several large projects in the city centre which are nearing completion. Weighing against these are several other large projects which are starting, this will provide some continuity for sub-contractors and certainly the opportunity to bid for a significant replacement workload.

■ Lead times across the market in general are decreasing and specialist trades such as mechanical and electrical are more readily available. Upcoming large-scale residential development will soak up some of any spare capacity due to project completions.

■ Newport and Swansea continue to face busy construction market conditions, with private developers driving a thriving student accommodation market.