Project Managers in for Buoyant 2019?
Project management and construction jobs are particularly sensitive to economic confidence. With so much negativity surrounding the endless Brexit shenanigans, and recent PMI data prompting headlines such as the Guardian’s Feb 4th, 2019 article titled “UK construction growth close to stalling as Brexit fears build” casting a shroud of gloom over the sector, project managers who rely on a buoyant environment must be wondering, “What next?”.
Well, the next is the polar-opposite findings from the UK Crane Survey published by Deloitte only a couple of days after those PMI numbers. Forget the doom and gloom. New build development is booming. The real-life findings are a real boost for optimism if you believe in watching what builders and developers are doing rather than listening to what they are saying.
Confidence High As Cranes In Regions
New build developments in UK regional cities are at or near record levels, after overall construction stretched to record levels last year (and after the ‘disastrous’ PMI in construction reading of 50.2 in January 2018 showed a sector “teetering on contraction”).
Developers continue to build out new homes, offices, retail, hotels and student housing at in the same levels as in 2018. Belfast office space is bubbling In Belfast, the office sector is on fire. The Cranes Index shows that there are 34 schemes under construction in the city. This is after 21 schemes were completed in 2018. A further nine schemes are due for completion this year.
During 2018, work started on 400,000 square feet of Grade A space. Belfast is well on the way to meeting the target of 1.5 million square feet of new office space by 2021.
Birmingham is Bullish
The mood in Birmingham is extremely bullish. A total of 23 new schemes were started in 2018, and 13 of these were residential. There are currently more than 5,000 units under construction, following a record number of residential completions in the city centre in 2018. New office development is running at 1.4 million square feet, and 2019 should set a record for completions.
Leeds is Alight
Development of residential and office space is breaking records in Leeds, too, with the newest developments in the city centre since the Crane Survey started in 2002. A colossal 21 schemes were started in 2018. This includes seven office schemes on top of the record 840,000+ square feet of office space in the pipeline. Three new residential projects kicked off. There are now 2,119 new units under construction. Five developments are in the build-to-rent sector, a new departure for the city.
Manchester is Mesmerising
In Manchester, new build office space has reached a magnificent two million square feet under construction. The 13 schemes being developed add to the 1.5 million square feet of space added between 2015 and 2017. However, development of office space pales into comparison when measured against residential. Manchester is a big city, of course, and it is growing, too. Population growth has prompted an explosion in residential starts, with more than 14,000 currently under construction. To put this into context, last year was a record for residential delivery in the city with just short of 2,600 units completed. In 2011, Manchester had only a single crane working in the city. Today, it has more than any city in the United States, with a total of 78 sites being developed.
Regional Cities - New Build Buzz
The regional cities are buzzing. There is no doubt that this is great news for those seeking a move in project management in construction. Contrary to other surveys, which tend to measure the emotional effect of events such as Brexit, Deloitte’s Crane Survey is telling us that developers and investors remain confident. Of course, this confidence doesn’t mean it will all be plain sailing. Brexit is still a headwind that must be negotiated, and continued investment will be key going forward. However, further south, in London, there are signs that inward investment is expected to remain resilient and even grow in the next five years.
London is the world’s most popular city for global real estate investment London has again been cited as the world’s most popular city for real estate investment in the most recent Cushman & Wakefield global report. This makes nine out of 10 years.
Despite the shadow of Brexit hanging over London, the capital city saw a 22% rise in inward investment in 2018. (While we’re on the subject of the attractiveness of the UK as a destination for investment and business, Forbes names the UK as the best place to do business.)
Central London office investment volumes in 2018 were 7% above the 10-year average, and London City volumes were a massive 30% above. Investors from the East and Far East have been particularly active: Middle Eastern investors ploughed in more than £1.3 billion (up 30% on 2017) according to Savills Singapore and South Korean investors upped the ante, too, as a total of £7.3 billion was invested in London real estate between the first and third quarters of 2018 The London Development Barometer – which asks house builders, institutions and local authorities of their market views – found that 51% forecast that investment into London will either increase or not change over the next five years.
Prime London In Demand
Coutts has reported that London’s super prime property appears to be immune from any current property market sluggishness. Properties priced above £10 million changed hands faster in the fourth quarter of 2018 than at any time since before the EU referendum in 2016. Only one in five were sold at a discount to the asking price – the lowest rate for three years. London’s property market has been hit hardest since the Brexit vote. The movement we’re now seeing in the top end of the market could be the forerunner of recovery to come later this year.
Project Manager Jobs
The PMI survey asks what purchasing managers think of the future, so is a forward indicator. The Cranes Index looks at what is actually happening now. We saw the PMI come even lower this time last year, yet 2018 was a record year.