JLL: North West most active region outside South East for construction

The North West was the strongest regional market in England for new construction activity, outside London and the South East, in the year to March 2016, according to the JLL and Glenigan UK Commercial Construction Activity Index.

The research found in the 12 months to the end of the first quarter, work started on £2.2bn of non-residential construction schemes in the North West, compared with £1.8bn in the West Midlands and £1.4bn in Yorkshire.

However, the figures represented a 9.6% drop in the value of new project starts recorded to the end of Q4 2015. This decrease reflected the national picture, which saw the value of new construction projects fall by 7.2% from the previous quarter, to £23bn.

JLL and Glenigan said despite construction outputs dropping nationally, there was continued willingness from developers to commit to the core sectors of office, retail and industrial.

Peter Lees, head of building consultancy at JLL, Manchester, said: “In spite of a drop off in construction starts nationally in Q1, the North West continues to outperform other regions and the market remains resilient, with a continued focus on the office and industrial sectors and, although not included in the data, residential markets.

“What’s more, there is appetite for commercial projects in alternative markets such as education, which saw a rise of 5.1%. In all, although the data is volatile, we’re optimistic the levels of growth in non-residential developments will be boosted by the growing demand for commercial floor space in major cities such as Manchester and Liverpool.”

London dominated the market, with £7.4bn of new projects starting in the capital by Q1 2016, the highest level since 2008.