The Week That Was - 22 July 2024

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

King's Speech sets out the Government's proposed legislation for the construction industry 

Last week saw the State Opening of Parliament where King Charles III read out the new Government's vision for the future and set out forthcoming proposed legislation to tackle a broad spectrum of issues. In construction, there were plans for “immediate action” to meet the 1.5m new homes target by 2029, spearheaded by the Planning and Infrastructure Bill. The Bill provides for planning reform to accelerate the delivery of infrastructure and housing, including streamlining the process for approving critical infrastructure and, crucially, overhauling rules on the compulsory purchase of land to reduce the amount of compensation required to be paid to landowners. It is hoped that the bold housebuilding plans will also address the current skills crisis in the construction industry.

Read more about the proposals here.

Government appoints new construction minister

Sarah Doyle, MP for Croydon West, has been appointed as the recently elected Government's new construction minister. She will work across both the Department for Energy Security & Net Zero and at the Department for Business & Trade as Minister of State.  It is also expected that she will be the new co-chair of the Construction Leadership Council, if it is to remain in its current form.  

Doyle has previously been an outspoken critic of permitted development rights, a policy designed to encourage the development of new housing unfettered by planning constraints.  She is also a long-standing supporter of the UK steel industry, vital to the UK construction market. She will be the 10th construction minister in the last 5 years and it is hoped that with the new Government, the position will bring stability and a consistent approach to the industry.

Read more about the appointment here.

Plans submitted for £1bn Salford towers scheme including tallest building outside London

Henley Investment Management has submitted plans for a retail park redevelopment on the boundary of Salford and Manchester involving 3,200 homes spread across ten buildings at a site which is currently occupied by big box retail units.  This £1 billion redevelopment will include the construction of the third tallest skyscraper in the UK (behind The Shard and Twentytwo in Bishopsgate), rising to more than 70 storeys at 264m tall. The centrepiece of the development will be a 3.5-acre urban public park, providing much-needed green space for the residents of Salford.  Henley is targeting vacant possession of the first phase of the site by 2026.

The plans have been drawn up by Manchester practice Matt Brook Architect.

For more information, please click here.

Skills gaps and green construction innovations challenge quality control

The construction industry is grappling with significant skills shortages and the emergence of green construction innovations.  This "perfect storm" is driven by post-COVID talent migration, an ageing workforce, and escalating demand.  Europe and North America face severe labour shortages, with projections of a two-million worker shortfall in Europe by 2030 and an existing deficit of over 500,000 workers in North America.

In addition, sustainable infrastructure requirements introduce new risks, and innovations such as carbon-efficient mass timber require rigorous construction practices to mitigate hazards.  Traditional quality control methods, often manual and paper-based, worsen these issues by obscuring visibility and increasing errors. 'Construction 4.0' technologies may offer a solution, enhancing transparency and standardising quality management. Digital tools can automate defect documentation and communication, reducing human error and improving safety. 

You can read more here.

Charles Henshaw & Sons Ltd enters administration

After 120 years, Charles Henshaw & Sons Ltd, a leading Scottish façade specialist, has entered administration due to financial pressures from legacy contract costs and delays in new projects, resulting in reduced margins and trading losses.  The directors decided not to seek a buyer for the business, putting 72 employees at risk of redundancy.

Founded in Edinburgh, the company expanded in 1982 to offer aluminium glazing systems.  Landmark projects include the Usher Hall, Harvey Nichols, and Glasgow Queen Street Station, along with conservation works like Greyfriars Bobby and Piccadilly Circus' Eros statue.

Managing Director Graham Chung expressed pride in the company’s legacy and regret over its closure, praising the skilled team and their contributions to the UK skyline. Shona Campbell of Henderson Loggie, appointed as the administrator, is focused on supporting affected staff and seeking buyers for the company’s assets.

You can read more here.

Willmott Dixon reports pre-tax loss of over £5m

Willmott Dixon has announced a pre-tax loss of £5.2m for the last year, a significant drop from the £800,000 profit recorded previously.  This figure excludes exceptional items, with audited accounts to be filed at Companies House next week.  Turnover remained flat at £1.2bn, with construction revenue just over £1bn and the interiors division contributing £131m.

Chief Executive Graham Dundas, who succeeded Rick Willmott earlier this year, attributed the loss to significant inflation and critical supply chain failures affecting key projects.  Despite these challenges, the company has had a strong start to the new year, securing £700m in new orders in the first five months and boasting a record order book of £3bn as of April. Additionally, cash reserves have risen to £115m.

The company remains optimistic about future prospects despite last year's setbacks.

You can read more here.

Authors: Natalie Chan, Tom Butterfield and Sky Arklay

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.