The week that was - 12 January 2024

Welcome to the week that was, a round-up of key events in the construction sector over the last seven days.

UK Government publishes proposals to make it easier to retrofit historic buildings 

The UK Government is pushing for a more straightforward retrofitting process for historic buildings to improve energy efficiency, addressing challenges highlighted in a recent comprehensive review.  

With over 10% of the nation's housing situated in conservation areas or listed, significant barriers include planning complexities, skills shortages, and the high cost of specialised materials needed for preservation. Proposed measures include simplifying permission processes through local listed building consent orders and introducing a National Development Management Policy for consistent planning. Revisions to the National Planning Policy Framework aim to prioritize the retrofitting of historic buildings.  

To bridge skills gaps in the construction industry, the Government plans to provide enhanced information and training programmes. Grosvenor, a major custodian of historic properties, supports these reforms, underscoring the potential for significant carbon emission reduction, and estimating that retrofitting the UK's historic buildings could generate £35 billion of economic output per year. The proposals published by the Government can be found here.
 
Environmental legal challenge to £250M Derby Road upgrade project

A £250 million plan to upgrade road junctions in Derby, called the A38 project, is facing a legal challenge.  The initiative, which involves enhancing roundabouts at Kingsway, Markeaton, and Little Eaton through flyovers, underpasses, and road widening, has been in progress since 2018, under the consortium Linkconnex, including Bam Nuttall, Mace, and AECOM.  However, it encountered a setback in 2021 due to insufficient assessment of its carbon impact, prompting a legal challenge by the Stop the A38 Expansion group.  

Despite receiving a new development consent order in August after a reassessment by National Highways, the project is now back under legal scrutiny.  Concerns raised include outdated economic assessments and potential increased costs.  The outcome of the trial may be influenced by a parallel challenge regarding the proposed A47 road expansions in Norfolk and their carbon emissions impact, with a decision expected in the spring. Campaigners stress the need for prioritizing climate action over road expansion and are seeking funds for legal representation. National Highways remains committed to the project but awaits details from the court.

More information can be found here.
 
Manchester Airports Group seeks supplier to deliver a £550m capital programme of airfield works

Manchester Airport is looking for a firm to undertake work covering construction and rehabilitation of concrete and asphalt airside infrastructure. The work will primarily cover Manchester Airport, as well as East Midlands and Stansted airports during a 5-8 year programme. Each of the five available lots cover a spend of £44m and £185m. This latest phase of construction will see improvements to Manchester Airports Terminal Two at the northern gateway, originally opened in 2021, by installing an additional Pier to increase the terminal’s capacity, together with upgrades to the original terminal building.

See here to read more.

2023 contracts league results

The list of top 100 contractors of 2023 has been published online, using data collected by Barbour ABI.

Morgan Sindall ranked first place in the contracts league champion list for 2023, with the greatest work haul estimated at £2.14bn. The firm also secured the highest number of contracts, with 153 projects during 2023. This is an improvement on their 2022 result where the firm ranked 6th place with £1.42bn.

Bouygues took second place, with £1.97bn of work and securing 11 new contracts over the year. Balfour Beatty ranked third place, with around £1.94bn and 51 new contracts secured. Kier dropped from first place in 2022, with £3.18b, to 7th place in 2023, with a total work haul estimated at £1.18bn.

The top 100 firms amassed over £36bn of work in total – down 16% on last year.  See here to read more. 

Architects blame the Government and a lack of flexibility after a £2.9bn underspend on the housebuilding fund

After the inception of the housebuilding fund 6 years ago, which amounted to £4.2bn, it has been revealed that to date the Government has only spent £1.3bn.  The fund was established to assist local authorities in providing physical infrastructure for new homes. According to housing experts, inflation has caused some projects to stall or become undeliverable, with a former official also blaming 'ridiculous business case requirements' imposed by Whitehall.  However, architects are blaming a lack of flexibility in the fund, particularly in relation to smaller schemes, where developments can move forward quicker.  Alex Ely, founder of Stirling Prize-winning Mæ Architects, believes that "a more joined-up strategy and flexible funding is needed to help unlock the opportunity to deliver more and better-quality homes".

To read more, please see here.
 
Construction activity falls for fourth successive month but at a slower rate

Once again, the latest S&P Global/IPS UK Construction Purchasing Manager Index showed that activity fell, but was at the highest it has been for four months.  The decline of the housebuilding sector has eased to its slowest rate since July 2023, with the commercial construction sector dropping by its fastest rate for three years.  However, there is growing confidence in the sector, with the latest polls anticipating an increase in business activity in 2024.  Fraser Johns, Finance Director at Beard, believes that "elevated borrowing costs and uncertainty in the economy" have contributed to the decrease in activity but remains positive due to high demand on the south coast.  However, Aecom are hoping that there will be fresh impetus on the wider economy, following a general election.

To read more, please see here.
 
Authors for this week's edition: Tom Cameron, Alisha Jackson, Josh Ovens.

Disclaimer: The information in this publication is for guidance purposes only and does not constitute legal advice.  We attempt to ensure that the content is current as at the date of publication, but we do not guarantee that it remains up to date.  You should seek legal or other professional advice before acting or relying on any of the content.